Premier Enterprises and Anr v. Office of the Commissioner of Industries and Anr

11. On the contrary, it is submitted by the learned counsel of the Respondent that the petitioner has blatantly violated the terms of the Lease Deed dated 18th August 1992. The Lease Deed in favour of the petitioner was executed for the purposes of carrying out activity of manufacturing surgical bandages. However, a report of Estate Manager dated 17th February 1997 revealed that the premises in question was converted into a Banquet Hall. Pursuant to this finding, Show Cause Notices were issued to the petitioner on 19th March 1997 and 26th September 1997 via registered post to the original allottee/petitioner.

12. It is submitted on behalf of the respondents that as per Clause 5(a) of the Lease Deed, the lessee/petitioner could not have sold, transferred, assigned, sublet or otherwise parted with the possession of whole or any part of the industrial plot except with the prior consent of the lessor in writing. It is submitted that the allottee was required to reply within seven days of issuance of the Notice dated 19th March 1997 and within fifteen days of issuance of the Notice dated 26th September 1997, however, no reply was received on the said notices.

13. It is further submitted on behalf of the respondents that it was only thereafter, the allotment in the case was cancelled and the lease was determined with the approval of Lt. Governor of Delhi vide Order dated 28th May 1998. It is submitted that by the said Order, the lessee/petitioner was required to hand over the peaceful possession of the said plot to the Estate Officer, Office of the Commissioner of Industries within seven days of receipt of the Order. The lessee also had the liberty to appeal before the Lt. Governor of Delhi within thirty days of the date of issuance of the letter. However, the possession was not handed over to the respondent and therefore, the matter was referred to the Estate Officer for initiation of eviction proceedings, consequent to which the Order dated 13th February 2003 was passed by the Estate Officer directing the petitioner and all persons in the occupation of the plot in question to vacate the same within fifteen days from the date of publication of order.

14. On behalf of the petitioners, it is submitted that the Lease Deed has been determined by the ex-parte order dated 28th May 1998, whereby it was alleged by the respondents that the petitioner was served two Show Cause Notices dated 19th September 1997, however, the concerned authority failed to appreciate that the respondent witness, A.K. Rai, has admitted that there was no evidence to show that the said Notices were actually served upon the petitioner. The said witness also admitted that a Lease Deed cannot be cancelled by anyone below the rank of Lt. Governor of Delhi. However, these facts were also not appreciated by the Estate Officer as well as the Appellate Court.

15. Learned senior counsel submitted that the Lease Deed contained Clause 4 on provisions of re-entry, which clearly spelt out that before any coercive action of re-entry is to be taken, a notice is a must and if the breaches are of remediable nature, then opportunity to remedy the same must also be given to the lessee. It has been admitted by the respondent witness in his cross-examination that in the present case, no Notice under Clause 4 of the Lease Deed was sent by the respondents to the petitioner. Further, the said witness has also confirmed that no notice was sent to the petitioner between 7th April 1998, i.e., the date of inspection report, and 28th May 1998, i.e., the date of ex-parte cancellation order. Under these circumstances, it is evident that the cancellation order dated 27th May 1998 itself is not sustainable in the eyes of law. Reliance has been placed upon Express Newspaper vs. Union of India, AIR 1986 SC 872, wherein it was held that for enforcement of the alleged right of re-entry if any, upon the forfeiture of lease due to breach of term of lease is by way of filing of suit by the lessor and not PP Act proceedings.

16. Learned senior counsel submitted that the proceedings under the PP Act were conducted in a biased manner, since, the petitioner appeared before the respondent no. 2 and summoned two of its witnesses, Estate Manager of respondent no. 1 with inspection report of the premises in question and the Deputy Director, DDA with the Scheme Regulation regarding Banquet Halls on 24th January 2003, however, the respondent no. 2 in blatant violation of principles of natural justice and procedure of law did not allow examination of these witnesses. Moreover, the respondent no. 2 closed the evidence of petitioner no. 2 abruptly, and without affording opportunity to address the closing arguments on behalf of the petitioner, reserved the matter on the same day. Whereas, the respondents were given a period of two years to adduce their evidence. Ultimately, the impugned order dated 13th February 2003 was passed without the proper appreciation of facts and evidence and hence, the petitioner preferred an appeal against the said order.

17. Learned counsel for the respondents, on the other hand, submitted that the petitioner made a representation before the Lt. Governor of Delhi for restoration of allotment of the plot, however, the same also came to be rejected. Aggrieved by the order of the Lt. Governor, the petitioner filed an Appeal, and the Appellate Court giving the similar observations on violation of terms of the Lease Deed also rightly dismissed the Appeal of the petitioner.

18. The respondents have alleged violation of Clause 5 (a) of the Lease Deed dated 18th August 1992, which stipulates that the lessee shall not sell/transfer the premises in question without prior permission of the lessor, and Clause 13, according to which the premises in question shall not be used for any other purpose than specified in the Lease Deed. It is submitted that the Estate Manager of respondents was summoned by the petitioner who had the inspection report dated 8th April 2002, appended to the petition as Annexure P-12/13, which showed that there was no misuse of the premises in question. However, the Estate Officer did not allow the witness to be produced. The said inspection report was also placed on record before the Appellate Court, however, was overlooked.

19. It is submitted by the Respondents that the Notices under Section 4 of the PP Act were duly served and communicated to the petitioner as well as the original allotee before the cancellation of the Lease Deed. It was observed by the Appellate Court that the Notices were sent on the leased premises and on the address of the original allottee at Shalimar Bagh. Yet no reply was received and eventually, the Lease Deed was cancelled vide Order dated 28th May 1998.

20. It is submitted that the transfer of proceedings from one Estate Officer to another were in accordance with law and the respondent no. 2 was appointed by a proper notification by the Central Government vide Notification dated 10th April 1995.

21. Learned senior counsel on behalf of the petitioner submitted that the Appellate Court did not consider the fact that the proceedings before the Estate Officer were not in consonance with the law.

22. It is submitted on behalf of the petitioners that during the proceedings under the PP Act before the Estate Officer, the petitioner filed a list of witnesses and evidence by way of an Affidavit and summoned the witnesses so to be produced, however, without any proper notification, the proceedings were transferred from one Estate Officer to another, i.e., respondent no. 2. The appointment of the Estate Officer was not in consonance with the provisions of the PP Act yet the Appellate Court also did not appreciate this aspect while deciding the Appeal.

23. It is submitted that during the pendency of the appeal, a scheme of respondent no. 1 came into being for conversion from leasehold to freehold. Relying upon the cases of J.K. Bhartiya vs. Union of India, 126 (2006) DLT 302, Union of India vs. Vinay Kr. Aggarwal, 116 (2005) DLT 322 (DB) and Bal Kishan Chhabra vs. Union of India, 127 (2006) DLT 460, learned counsel for the petitioners submitted that the Scheme was applicable to those cases as well where lease deed has been cancelled and hence, the petitioner is entitled to the benefit of the Scheme. Any discrepancies in restoration of the lease deed could be resolved. It has been stated that according to various judgements of this Court a lease deed ought to be restored and converted into free-hold. Any cancellation proceedings, if underway, must be withdrawn, once an application is placed under the abovementioned scheme. As per the said conversion scheme when the latest GPA holder applies for conversion in favour of the latest purchaser and pays the conversion charges plus surcharge, the lease cancellation orders, if any, have to be withdrawn and the lease deed has to be restored and the conveyance deed has to be granted to the latest purchaser. The petitioner accordingly, made a representation alongwith Conversion Application Form and requisite fees before the respondent no. 1 which was also not appreciated in proper perspective and was therefore, rejected vide letter dated 21st March 2007. The challenge against the said order is the subject matter of W.P. (C) 4257/2007. The petitioner also made subsequent representations/applications with the requisite fees/ bank drafts dated 10th July 2009 and 28th August 2009.

24. Placing reliance on the matter of Hari Prakash Education Welfare Society vs. DDA, 152 (2008) DLT 84 (DB), it is submitted that as per the several judgments passed by this Court regarding the Conversion Scheme, the lease deed in the present case ought to be restored and be converted into freehold. The relevant judgements passed by this Court in this regard were placed on record before the Appellate Authority. However, the Appellate Court has completely overlooked and ignored the same while passing the impugned order. It is submitted that if the lease is restored or cancellation thereof is held invalid, then the PP Act proceedings, even if concluded, would become redundant.

25. It is submitted on behalf of the respondents that the Appellate Court held that the Central Government may appoint any person, being a Gazetted Officer or Officer of equivalent rank as Estate Officer by notification in the Official Gazette. It is submitted that the transfer of proceedings from one Estate Officer to another were in accordance with law and the respondent no. 2 was appointed by a proper Notification by the Central Government dated 10th April 1995. It is further submitted that the Appellate Court while passing the impugned order carefully considered and perused the record before the Estate Officer and only then came to a finding that ample opportunity was given to the petitioner to lead evidence and address its arguments. The Estate Officer considered and examined all the evidence placed before him. It is submitted that the application before the Estate Officer had already been considered by him and an application for producing witnesses at a belated stage was only to delay the proceedings before it.

26. Learned counsel for the respondents submitted that the petitioner is seeking conversion from leasehold to freehold, however, such a conversion can only be affected in favour of the power of attorney holder when there is a valid subsisting allotment existing. In cases where the lease deed stands determined the allotment has to be restored and only then can application for conversion can be processed. It is submitted that as per the Scheme, under Para 6(ii) it is specifically provided that in case of the re-entered properties, conversion would be allowed only when reentry notice has been withdrawn and lease deed/allotment has been restored. It is further submitted that restoration of Lease Deed and conversion from leasehold to freehold is not a composite process rather it implies that the case of conversion would be allowed only after process of restoration, if any, as per merits, is concluded under the relevant provisions of the Land Management Guidelines and is allowed.

27. It is submitted that in the instant case of the petitioner, the matter of revocation of order of determination of lease was decided against the petitioner and till the plot is restored in its name, there will be no cause for allowing conversion from leasehold to freehold as per the Scheme.

28. Heard learned counsel for the parties and perused the record.

ANALYSIS AND FINDINGS

29. At the very outset, it is pertinent to outline the scope of writ jurisdiction under Article 226 and 227 of the Constitution of India while examining and adjudicating upon an impugned order in the instant petition. Scope of Writ Jurisdiction

30. Under Article 226 of the Constitution of India, High Courts have the power to adjudicate upon an impugned order along with the power to entertain writs in the nature of habeas corpus, mandamus, prohibition, quo warranto and certiorari. While adjudicating upon an impugned order, the scope of writ jurisdiction is narrowed to examining the contents of the order which is before the Court. Any consideration beyond assessment of the impugned order, including investigation into evidence and question of facts would amount to exceeding the jurisdiction. While examining the challenge to an impugned order, the Court has to limit itself to the consideration whether there is any illegality, irregularity, impropriety or error apparent on record.

31. In Nagendra Nath Bora vs. Commr. of Hills Division and Appeals, AIR 1958 SC 398, the Hon‟ble Supreme Court made the following observations while examining the scope of interference by High Courts in an order impugned and what would constitute an error apparent on record:-

32. The Hon‟ble Supreme Court in Union of India vs. P. Gunasekaran, (2015) 2 SCC 610, elaborating upon the extent of exercise of writ jurisdiction, held as under:-

33. Further, the Hon‟ble Supreme Court in Sarvepalli Ramaiah vs. District Collector, Chittoor, (2019) 4 SCC 500, made the observations as reproduced hereunder, while examining the scope of Article 226 of the Constitution of India:-

34. Further in Sanjay Kumar Jha vs. Prakash Chandra Chaudhary, (2019) 2 SCC 499, the following observations were made by the Hon‟ble Supreme Court:- “13. It is well settled that in proceedings under Article 226 of the Constitution of India, the High Court cannot sit as a court of appeal over the findings recorded by a competent administrative authority, nor reappreciate evidence for itself to correct the error of fact, that does not go to the root of jurisdiction. The High Court does not ordinarily interfere with the findings of fact based on evidence and substitute its own findings, which the High Court has done in this case....”

35. The law, as has been interpreted by the Hon‟ble Supreme Court, is clear that a High Court exercising its writ jurisdiction shall not appreciate evidence and must not interfere in the order impugned unless there is a gross illegality or error apparent on the face of record. Hence, this Court will also limit itself to the question of law and the contents of impugned orders. Findings qua Order of Estate Officer dated 13th February 2003

36. This Court has perused the impugned order dated 13th February 2003 bearing No. F./EO/CI/6/2003/291. The said order was passed under Section 6 (1) of the PP Act which reads as follows:-

37. Consequent to the passing of an ex-parte order of cancellation Lease Deed dated 28th May 1998 and a corrigendum thereto dated 30th June 1998 whereby the lessee/petitioner was directed to hand over the peaceful possession of the premises in question for having violated the terms of the Lease Deed the said Notice under Section 6 (1) of the PP Act was issued. The relevant portion of the impugned order dated 13th February 2003 is reproduced hereunder:- “The plot was allotted to Smt. Pushplata on lease with conditions laid down in the lease deed dated 18.8.1992. The lease was determined by lessor for violation of the conditions of lease deed after issuing show cause notice and following due process of law. The detail contraventions are specified in the determination order dated 28.5.1998. The Joint Director of Industries (Land made reference to the Estate Officer vide letter No. FIEP/CI/FP/98/106/1780 dated 4.9.98 stating clearly that the ex-allottee has not handed over peaceful possession of the premises and same should be evicted under Public Premises (eviction of Unauthorised Occupants) Act, 1971. The Notice under sub-section (1) and clause (b)(ii) of sub-section (2) of Section 4 of the P.P. Act was issued vide letter No. EQ/CI/1/98/590-592 dated 17.11.98 to M/s Premier Enterprises, Plot No. 106. Functional Industrial Estate, Patparganj, Delhi. One copy was pasted on the door of the factory premises. One Smt. Soma Rani W/o Shri Avinash Lal Sachdeva, R/o D-1/72, Lajpat Nagar, New Delhi, claiming to be GPA of Smt. Pushplata filed objections stating that lessor has not given any show cause notice or opportunity of personal hearing. The allottee is doing activities as per the law and there is no contravention of lease conditions. She further stated that she has applied for restoration of lease. Her premises should not be evicted under the P.P. Act. The Department pleaded that the ex-allottee was issued show cause notice and afforded an opportunity of personal hearing and lease was determined by the lessor by following due process of law. Smt. Pushplata and Smt. Soma Rani GPA occupying the premises unauthorizedly and are not hading over the peaceful possession. The department pleaded that orders of evicting unauthorized occupants be passed forthwith. The submission made in writing and in person by unauthorized occupants have been gone through in detail. It is well known to the ex-allottee and present occupants that they are in unauthorized occupation of the premises after the lease has been determined by the lessor after following the due process of law. They are willfully not handing over the possession of the premises i.e. Plot No. 106, FIR Patparganj, Delhi. Now, therefore, in exercise of the powers conferred on me under sub-section (1) of Section 5 of the Public Premises (Eviction of Unauthorized Occupants) Act, 1971, I hereby order the said Smt. Pushplata and all person who may be in occupation of the said premises or any part thereof to vacate the said premises within 15 days of the date of publication of this order. In the event of refusal or failure to comply that with this order within the period specified above the said Smt. Pushplata and all the other persons concerned are liable to be evicted from the said premises, if need be, by the use of such force as may be necessary.

38. The primary grounds taken by the authority while cancelling the lease of the petitioner were, first, transfer of premises in question without prior permission of the lessor and, secondly, use of the premises in question for purposes other than provided for in the lease deed. The entire controversy started when the premises in question was found to be being used for purposes other than what the lease was executed for.

39. The Estate Officer while passing the impugned order noted that the concerned two persons, i.e., Smt. Pushplata and Smt. Soma Rani were found to be in unauthorized occupancy of the property in question. A perusal of the ex-parte order dated 28th May 1998 revealed that two Show Cause Notices dated 19th September 1997 were served upon the petitioner, however, the persons concerned failed to respond or appear before the concerned authority while the proceedings for determination of lease were underway. The petitioner has argued that the said Show Cause Notices were never received by it and hence, it came to know about the cancellation of the lease only when proceedings under the PP Act were initiated against it. However, the respondents submitted that the Notices were duly served upon the petitioner and its directors. This issue regards to a dispute of facts which cannot be adjudicated and looked into by appreciating evidence and conducting a roving inquiry into the proceedings. Therefore, the contents of the impugned order shall be looked into to evaluate the position. To this effect, the Estate Officer noted in the impugned order that the petitioner was called to explain its position regarding transferring the property in the name of petitioner no. 2 and using the property for purposes other than the purpose laid out in the Lease Deed, since no reply was received, the above mentioned Show Cause Notices were issued for cancellation of the lease. Therefore, it is not a case where the petitioner was not given any opportunity to appear before the concerned authority and present its case against cancellation of Lease Deed.

40. The contents of the impugned order suggest that the petitioner was found to be in violation of the conditions of the Lease Deed executed on 18th August 1992. The same have been reproduced hereunder:- “(5)(a) The Lessee shall not sell, transfer, Assign, sublet or otherwise part with the possession of the whole or any part of the industrial plot except with the previous consent in writing of the Lessor which he shall be entitled to refuse in his absolute discretion.

PROVIDED that such consent shall not be given for a period of ten years from the commencement of this lease unless, in the opinion of the Lessor, exceptional circumstances exist for the grant of such consent.

PROVIDED FURTHER that in the event of the consent being given, the Lessor may impose such terms and conditions as he thinks fit and the Lessor shall be entitled to claim and recover a portion of the unearned increase in the value (i.e. the difference between the premium paid and the market value) of the industrial plot at the time of sale, transfer, assignment, sub-letting or parting with the possession, the amount to be recovered being fifty per cent of the unearned increase and the decision of the Lessor in respect of the market value shall be final and binding: PROVIDED ALSO that the Lessor shall have the preemptive right to purchase the property after deducting fifty per cent of the unearned increase as aforesaid. (13) The Lessee shall not without the written consent of the Lessor use or permit to be used, the industrial plot or any building therein for residence or for carrying on any trade or business whatsoever or use the same or permit the same to be used for any purpose other than that is running a small scale industry for carrying on the manufacturing process or running the industry of Surgical Bandages or such other manufacturing process or industry as may be approved from time to time by the Lt. Governor or do or suffer to be done therein any act or thing whatsoever, which, in the opinion of the Lessor, may be a nuisance, annoyance or disturbance to the Lessor and persons living in the neighbourhood. The Lessee further agree not to use the plot or the building erected thereon for any industrial activity that, in the opinion of the Lessor, is pollutant: PROVIDED that, if the Lessee is desirous of using the said industrial plot or the building thereon for a purpose other than that if the manufacturing process or industry as may be approved form time to time, the Lessor may allow such change of user on such terms and conditions, including payment of additional premium and additional rent, as the Lessor may in absolute discretion determine.”

41. Clause 5(a) of the Lease Deed expressly barred the petitioner no.1/lessee to transfer the premises so leased without the prior permission of the lessor. Yet the premises in question was found to be transferred in the name of the petitioner no. 2, without the said prior permission of the lessor.

42. Secondly, the Clause 13 also explicitly barred the lessee/petitioner to use the premises in question for purpose other than running the industry for „Surgical Bandages’. However, it is found that after having transferred the premises in the name of petitioner no. 2, it was being used as a Banquet Hall and not in any manner, whatsoever, for running the industry as stipulated in the Lease Deed.

43. Keeping in view these observations, the Estate Officer passed the impugned order dated 13th February 2003. The material before the Estate Officer was duly considered and appreciated by him and the observations as well as the findings given by the Estate Officer were in accordance with the provisions of law, the terms and conditions of the Lease Deed as well as the facts of the case. Findings qua the Appellate Order dated 30th October 2009

44. This Court has perused the impugned order dated 30th October 2009 passed by the learned District Judge in PPA No. 4/08/03. The said order was passed in the Appeal preferred by the petitioner against the order of the Estate Officer dated 13th February 2003. The petitioner while moving the court of learned District Judge and challenging the order of the Estate Officer invoked the following grounds: a. That there were no Show Cause Notices issued to the petitioner before cancellation of the Lease Deed. b. That the Show Cause Notices and the Order of the Estate Officer were against the facts. c. That the appointment of the Estate Officer, to whom the proceedings were transferred mid-proceedings, was not in accordance with the law. d. That there were no grounds with the Estate Officer to evict the petitioner from the premises in question. e. That the petitioner was not given opportunity to lead evidence. f. That the premises in question is not a public premises and therefore, the provision of PP Act were not applicable on the same.

45. The relevant paragraphs of the impugned order dated 30th October 2009 is reproduced hereunder:-

48. In the instant case, the concerned Estate Officer met the eligibility and was notified by the Central Government in accordance with the provisions of PP Act vide Notification dated 10th April 1995. The proper channel and procedure were followed while appointing the Estate Office concerned and there was no lapse or illegality that was found in his appointment.

49. It is submitted on behalf of the respondents that the next ground taken to challenge the order of the Appellate Court is that it did not consider the fact that the petitioner was not given sufficient opportunity to adduce evidence. The petitioner produced petitioner no. 2 as its witness who was examined. The said witness also produced his affidavit and also was cross-examined. The evidence of the petitioner was closed by the Estate Officer only after it was found that all necessary documents and material to ascertain the question of cancellation of the Lease Deed was already on record. Accordingly, it was rightly found that the petitioner was given ample opportunity to adduce evidence and only, thereafter, his evidence was closed.

50. Learned counsel for the respondents submitted that the petitioner has placed reliance on an enquiry report dated 8th April 2002 to submit that the premises in question was not being used for any other purpose than for Surgical Bandages, as per the Lease Deed dated which is appended to the petition as Annexure P-1. On a bare perusal of the report, it is found that the contents of the report state that the premises was being used for manufacture of cornflakes with the help of electrical machined. The contention of the petitioner is that the inquiry report dated 8th April 2002 has not been considered by the Appellate Court, however, the report itself does not suggest anything in its favour. Upon perusal of Cluse 13 of the Lease Deed it is found that the only purposes specified therein is „Surgical Bandages‟ and not any other. Even production of cornflakes, i.e., packaged cereal in no manner could be even remotely considered as the premises being used for the purposes specified in the Lease Deed.

51. All the above mentioned observations show that the Appellate Court considered the case of the petitioner, heard all the parties, appreciated the material and evidence on record before it and passed a detailed and reasoned finding on each of the ground invoked by the petitioner.

CONCLUSION

52. This Court, keeping the limitations to its powers as a writ court in mind, has perused and considered the pleadings, including the petition, the counter affidavit, the rejoinder and the written submissions filed by the parties and has found that both the impugned orders have been passed by the respective authorities in light of the facts, circumstances, evidence and other material on record and after giving the parties an opportunity of hearing.

53. After perusal of the orders, this Court does not find any gross illegality, error apparent on the face of record or any impropriety in the findings. The Estate Officer considered the facts and circumstances before it, heard the parties, gave sufficient opportunity to adduce evidence and then passed a reasoned order with the findings as have been reproduced in the order dated 13th February 2003.

54. Further, even the Appellate Court after conscious and thorough appreciation of grounds taken, arguments advanced, material placed on record and carefully perusing the order of the Estate Officer passed the order dated 30th October 2009 which also does not suffer from any gross illegality or error apparent on the face of record.

55. Both the impugned orders dated 13th February 2003 and 30th October 2009 are reasoned and have been passed after consideration and appreciation of all grounds and material on record. Therefore, this Court does not find any cogent reason to interfere in either of the orders.

56. Accordingly, the instant petition is dismissed for being devoid of any merit.

57. Pending applications, if any, also stand disposed of.

58. The judgment be uploaded on the website forthwith.

JUDGE SEPTEMBER 23, 2022 gs/ms