MORE JEEVAN YASHWANT AND 82 ORS. vs. THE MUMBAI MUNICIPLA CRPORATION AND ANR.

2017:BHC-OS:146-DB
     Judgment-WP.957.20133+.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO. 957 OF 2013
More Jeevan Yashwant }
and 82 Ors. } Petitioners
versus
The Mumbai Municipal }
Corporation and Anr. } Respondents
WITH
WRIT PETITION NO. 2165 OF 2009
Rajendra Eknath Sawant }
and 23 Ors. } Petitioners
versus
The Municipal Corporation }
of Greater Mumbai and Ors. } Respondents
WITH
WRIT PETITION NO. 1457 OF 2010
New Khardeo-nagar }
Co-operative Housing Society} Petitioner
versus
The Mumbai Municipal }
Corporation and Ors. } Respondents
WITH
WRIT PETITION NO. 1797 OF 2009
Brihan Mumbai Mahapalika }
Upanagar Baithi Chawl }
Rahiwashi Sangh } Petitioner
versus
The Municipal Corporation }
of Greater Mumbai and Ors. } Respondents
WITH
WRIT PETITION NO. 1536 OF 2008
New Khardeo-Nagar }
Co-operative Housing Society}
(proposed) } Petitioner
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versus
Brihan Mumbai Mahanagar }
Palika and Anr. } Respondents
WITH
WRIT PETITION NO. 1158 OF 2013
Anand Narayan Kambli } Petitioner
versus
Chief Accountant }
(Treasurer), Mumbai }
Municipal Corporation }
and Anr. } Respondents
Mr. B. S. Nayak for the petitioners in
WP/957/2013 and WP/1453/2010.
Mr. Sangraj D. Rupawate with Mr. Milind
Ingole for the petitioners in
WP/1797/2009 and WP/2165/2009.
Ms. C. S. Savithri for the petitioner in
WP/1158/2013.
Mr. A. Y. Sakhare – Senior Advocate with
Mr. Joel Carlos, Mr. H. C. Pimple and Ms.
Pooja Yadav for respondent-MCGM in
WP/957/2013, WP/1536/2008,
WP/1797/2009, WP/2165/2009 and
WP/1457/2010.
Mr. S. S. Pakale for respondent-MCGM in
WP/1158/2013.
Ms. Kavita N. Solunke – AGP for
respondent no. 2 and Mr. Milind More –
Addl. Government Pleader for respondent
no. 4 in WP/1797/2009.
Mr. Manish Upadhye – AGP for
respondent no. 4 in WP/2165/2009.
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CORAM :- S. C. DHARMADHIKARI &
B. P. COLABAWALLA, JJ.
DATED :- JANUARY 6, 2017
ORAL JUDGMENT:- (Per S. C. Dharmadhikari, J.)
1. The Writ Petition No. 957 of 2013 was directed to be heard
along with other writ petitions on board. Those petitions, which
have been already admitted, are tagged along with this petition
and by consent of all counsel, we have heard these petitions
together. Thus, this judgment and order would govern the fate of
Writ Petition Nos. 957 of 2013, 1536 of 2008, 1797 of 2009,
2165 of 2009, 1158 of 2013 and 1475 of 2010.
2. Hence, we grant Rule in Writ Petition No. 957 of 2013.
Respondents waive service. Since all the pleadings are complete,
this petition and others are heard finally.
3. In Writ Petition No. 957 of 2013, the 83 petitioners have
impleaded the Mumbai Municipal Corporation, established and
incorporated under the Mumbai Municipal Corporation Act, 1888
(hereinafter referred to as “the MMC Act”), as the first
respondent. The second respondent is the Administrative Officer
(Estate).
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4. It is the case of these petitioners that they are ex-municipal
employees. They have retired from the services of the Municipal
Corporation on attaining the age of superannuation. It is stated
that in or about 1989, the Municipal Corporation decided to allot
residential accommodation in its possession to its employees and
the claim is that they were to be allotted on permanent tenancy/
ownership basis. The petitioners were informed to form an
association of such persons. This petition involves Plot – CTS Nos.
41, 42, 72, 73, 84, 85 and 86 situate at Ghatla Municipal Colony,
Khardeonagar, Chembur, Mumbai 400 071. Though the
petitioners claim to be ex-employees, a statement is made in the
petition in para 2 that they are either ex-employees or slum
dwellers, who are photo-pass document holders.
5. We must, at once, clarify that we are dealing with the claims
of ex-employees of the Mumbai Municipal Corporation, who have
approached this court on the footing that there is a
representation from the Municipal Corporation to them that their
occupancy would be converted on permanent tenancy/ownership
basis and in terms of certain decisions taken by the Municipal
Corporation. It is relying on these decisions that the ex-
employees are claiming a writ of mandamus or any other
appropriate writ, order or direction in the nature thereof,
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directing the Municipal Corporation not to make applicable a
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circular dated 7 October, 2010 Annexure 'E' to the petition and
that the respondents should release their retiral benefits/dues
with effect from the date of their retirement, with interest at the
rate of 18% per annum from that date till payment. The
petitioners are also claiming a direction to the respondents not to
evict them from their respective tenements.
6. The petition proceeds on the footing that the tenements,
which are occupied by the present petitioners, were included by
the Municipal Corporation in the scheme of permanent housing
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accommodation in the year 1992 and on 25 April, 1992, the
Municipal Corporation issued a letter to that effect. However, till
date, this scheme has not been implemented. The petitioners and
similarly situated persons forwarded several representations/
letters to the respondents, but the respondents are declining to
implement their own scheme.
7. This petition is founded on the basis that though the ex-
employees and who have been allotted quarters and
accommodations, styled as “staff quarters”, ordinarily have no
right, title and interest in the same, yet, going by the
representation to these persons that their tenements would be
converted into ownership or permanent tenancy that they have a
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right to apply and for being considered along with similarly
placed municipal employees or ex-employees of the Municipal
Corporation. That is how they claim a vested or pre-existing legal
right, enabling them to apply for a writ of mandamus. In para 4 of
this petition, it is stated that the petitioners have formed a
proposed co-operative housing society of the occupants of
municipal tenements. In the year 1975, the first respondent/
Municipal Corporation acquired lands at Ghatla village, Chembur,
Mumbai for development of the scheme for housing dis-housed
persons. The said land was marshy land and was being used as
dumping ground for garbage collected in Mumbai. Considering
the situation and topography of the land, the Municipal
Corporation decided to construct semi-permanent ground floor
structures for housing dis-housed persons as well as its
employees. The first respondent constructed 56 colonies
comprising of 478 tenements, each admeasuring about 140
square feet for the purpose of housing the dis-housed and allotting
the surplus tenements to the municipal employees. After a lapse
of time, the municipal tenants' association represented to the
Improvement Committee of the first respondent and requested
that these tenements be converted into permanent tenancies or
granted on ownership basis. After great persuasion, the first
respondent accepted these proposals. By a decision, the
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Municipal Corporation made its intention clear that the land of
the tenements at Parksite (Vikhroli), Barvenagar (Ghatkopar),
Mithanagar (Goregaon West) and Deonar would be granted on
ownership basis. The Municipal Corporation passed a Resolution
st
dated 1 September, 1989 bearing number 343 to this effect. It
was also clarified that these tenements were not staff quarters.
They were not given to the employees as service tenements, but
were allotted on leave and licence or rental basis. The tenements
were not related to the service conditions.
8. The petitioners state that 313 tenements, out of 478 are
occupied by the municipal employees. These persons were
assured as above. Therefore, they were told to form a co-
operative housing society. There are 165 project affected
persons, to whom the first respondent has allotted tenements on
ownership basis. It is claimed that the petitioners are members of
societies included in the scheme of conversion of municipal
tenements into ownership basis. Then, there is a reference made
to various meetings with the Municipal Corporation and
proposals exchanged therein. It is submitted that the proposals
have been accepted. They were recommended for the sanction of
the Municipal Corporation, but are still pending. The petitioners,
therefore, complain that though the proposals have not been
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finalised, yet, the eviction proceedings have been initiated against
some of the retired employees of the Municipal Corporation. They
have approached this court by challenging the proceedings on the
ground of arbitrariness and discrimination. They argue that
some of the similarly placed persons have been allotted
tenements on permanent basis or there is a conversion effected.
Therefore, those against whom eviction proceedings are initiated,
are entitled to be treated on par and similarly. Then, there is a
reference made to a conversion of ‘H’ Block of the Deonar Colony
in favour of the municipal employees into ownership basis. Then,
some tenements in ‘B’ Block of Mithanagar were converted into
ownership basis and the occupants were permitted to form a co-
operative housing society. Then, the argument is that the
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Municipal Corporation issued a circular on 16 October, 2008,
whereunder, the retired employees were allowed to retain their
accommodations by making payment of normal rent till the
finalization of the court proceedings. It is also alleged that 10% of
the gratuity amount was withheld and from out of remaining
90%, accommodation rent would be recovered. A copy of this
circular is annexed as Annexure ‘A’ to the petition. The
argument is that similar petitions have been entertained by this
court and knowing fully well and being aware of the pendency of
legal proceedings, the Municipal Corporation issued the circular
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on 7 October, 2010. By this circular, the Municipal Corporation
decided to impose and recover penal rent at three times the
present rent from the occupants of the tenements in question. As
to how this circular works to the prejudice of the present
petitioners and similarly placed occupants is then explained and
copy of the circular is annexed as Annexure ‘E’. It is then
complained that despite specific directions issued by the court not
to evict the employees who are occupying the staff quarters and
not to take coercive action, the Municipal Corporation is issuing
eviction notices to the retired employees. The Municipal
Corporation has not taken a decision on the proposals and
recommendations, which have emanated from several statutory
authorities. That is how the petitioners have approached this
court.
9. Their second grievance pertains to withholding of their
retiral dues. According to the petitioners, these dues have not
been released because they refused to handover possession of the
tenements in their possession. This act is completely contrary to
the mandate of Articles 14, 16 and 21 of the Constitution of India.
It is claimed that terminal benefits and particularly gratuity and
pension are not a bounty, but a right. That has co-relation with
the services rendered. These services have been rendered to the
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complete satisfaction of the municipal authorities. None of these
employees had been visited with penalties or other punishments,
which would enable withholding their terminal benefits. The
terminal benefits are withheld only because of their alleged
wrongful possession of the municipal tenements. It is complained
that withholding of these terminal dues works as double jeopardy
in the sense that the petitioners cannot afford a housing
accommodation in Mumbai. Secondly, the rentals being, as they
are, even they cannot be paid in the absence of the terminal
benefits being released and in the form of money. Thirdly, some
of these persons, who are old and incapacitated, cannot support
themselves in the absence of these terminal benefits, some of
which are admissible monthly. In these circumstances that the
petitions, under Article 226 of the Constitution of India, have
been filed.
10. The petitioners proceed to annex lists of the municipal
employees and the two lists that are annexed contain the names
of original employees or their nominees. Then, one of the
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annexure is a circular and which is dated 16 October, 2008.
This circular states that the Municipal Commissioner has passed
an order. That order pertains to Deonar, Govandi, Barvenagar
(Ghatkopar), Mithanagar (Goregaon) and Parksite (Vikhroli).
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These colonies contain structures. These are chawl type
structures and single storeyed. These have been occupied by
retired employees of the Municipal Corporation. This order of the
Commissioner refers to the concession granted to these
employees, inasmuch as from the date of their retirement till the
final orders passed in legal proceedings, the tenements were
st
allowed to be occupied on payment of rent. On 1 November,
2007, the Municipal Commissioner has ordered that 10% of the
amount from the terminal/pensionary benefits of these
employees should be kept aside and from the balance 90%
outstanding, rent be adjusted and recovered. Together with this,
the eviction proceedings should be commenced. Then, there is a
reference to the order passed by this court in Writ Petition
No.2273 of 2003. A communication follows that order. Then,
there is a copy of an order passed in Writ Petition No. 1797 of
2009. There also an ad-interim order has been passed directing
the Municipal Corporation not to evict the members of the
petitioner association from the present accommodations. Then,
there is a reference made to a further ad-interim order in Writ
Petition No. 1797 of 2009, which is more or less on similar lines.
th
11. Then follows a circular dated 7 October, 2010, which is
challenged. A perusal of this circular would reveal as to how the
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policy of the Municipal Corporation has been that in the event a
municipal employee does not vacate and handover the premises
styled as municipal staff quarters, to the Municipal Corporation,
post his/her retirement, then, for next three months he can be
granted permission to occupy the same on payment of prevailing
market rent plus service charges. If any employee dies while in
municipal service or is unable to vacate the premises on account
of illness and medical treatment, then, the heirs/employee are
allowed to occupy the premises for six months on similar lines.
Thereafter, penal rent be charged and recovered from such
employees. However, despite such directions and policy, there is
a growing tendency of not handing over the municipal premises.
The municipal premises are retained unlawfully and illegally,
thereby, depriving those in-service and awaiting staff quarter
allotment. This has inconvenienced those in-service employees
and has also affected the municipal affairs. It is in these
circumstances that even after penal rent being charged, the
possession could not be recovered. Therefore, what the Municipal
Corporation has decided is that some tenements have to be
allotted as a special case to the municipal employees on
permanent tenancy basis. Therefore, the others, who are in-
service or those who have retired, are expecting a package of this
nature being extended to them. For all these reasons and to
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discourage the tendency as noted in the circular, the Municipal
Corporation formulated a policy, whereunder, they directed all
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the authorities that from 1 October, 2010, this policy and this
circular should be implemented strictly. The penal rent is
determined in terms of this circular. The petitioners are relying
upon some communications and which have been addressed to
the occupants in Ghatla village, informing that eviction
proceedings would be commenced for failure of that occupant to
handover vacant and peaceful possession of the tenement.
12. Thereafter, Brihanmumbai Mahapalika Upnagar Baithi
th
Chawl Rahiwashi Sangh addressed a representation dated 29
April, 2009 to the Municipal Commissioner inviting his attention
to allotment of certain tenements in Deonar on permanent
tenancy/ownership basis as special case. Therefore, the
expectation is that similar benefit will be extended to these
occupants as well.
13. The petitioners have filed an affidavit in rejoinder, dealing
th
with the affidavit in reply dated 13 June, 2014 filed in this court
by the Municipal Corporation.
14. We were unable to obtain even a copy of this reply, though it
is stated to have been filed in the record of this court. Neither
this court's staff or the registry was able to trace out the original
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affidavit in reply nor have they obtained a copy of the same from
any of the advocates appearing for the parties. The tenor of this
affidavit will have to be gathered from the affidavit in rejoinder.
15. The affidavit in reply proceeds to state that the tenements
are constructed by the respondents by making budgetary
provisions. The said quarters are allotted to the employees
during service tenure and are required to be vacated on
retirement from the municipal services. The quarters so
constructed under any budget cannot be given on ownership
basis. Certain premises are treated as service quarters and
allotted to the municipal employees because they are undertaking
particular work and where the presence of the said employees is
required all the time, namely, Fire Brigade, Hospitals, Water
Works etc. The service quarters are allotted free of charge and
except the employees and their family members, no one else is
allowed to occupy the same. It is stated that if these service
quarters are allotted on ownership basis, the functioning of these
departments will be seriously affected. The tenements are
constructed for allotment to the municipal employees and
according to the service seniority, these allotments are made to
those employees who have put in more than 10 years service and
to those who have more than three years to retire from the
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service. In special cases, an employee should have put in service
of more than one year and should have about three years to
retire. The tenements are allotted to the municipal employees on
leave and licence basis and such allottee has to execute a leave
and licence agreement as well as undertaking to vacate the
municipal tenement within three months of his/her ceasing to be
in municipal service. The rules prescribe that these respondents
will not entertain any proposal for alternative accommodation to
any municipal employee on his ceasing to be in service. It is
stated that in Brihanmumbai Mahanagarpalika, approximately
1,30,000 employees are working. In comparison to the number of
employees, the staff quarters are totally insufficient and
inadequate. There is a very long waiting list. The employees in
this waiting list are awaiting allotment of staff quarters. On
account of shortage of staff quarters, it is not possible to allot
these quarters to the employees, who are working in emergency
municipal duties. It is stated that as far as Khardeo Nagar,
Ghatla, there are 378 municipal tenements plus 100 tenements in
transit camp. The total of this is 478 tenements. The tenements
are allotted to the municipal employees as staff quarters and to
the project affected persons on tenancy basis and not on
ownership basis. As far as the challenge to the circular is
concerned, the affidavit explains as to how the Municipal
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Commissioner was required to step in and issue this circular. It is
stated that as per the directions of the Municipal Commissioner,
the retired municipal employees/their legal heirs, who are
staying in Baithi Chawls at Deonar, Parksite (Vikhroli) have been
permitted to say in the staff quarters subject to payment of
standard rent from the date of retirement till the date of final
decision by this court in the writ petitions, namely, Writ Petition
No. 2273 of 2003 and Writ Petition No. 1797 of 2009. That is
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how the circular has been issued on 16 October, 2008. That
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circular was withdrawn on 30 October, 2010. A revised circular
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dated 30 October, 2010 is being implemented and action under
section 105B of the MMC Act is initiated against all the retired
municipal employees/legal heirs of the deceased, who have not
vacated the staff quarters even after retirement/death. There is
another circular issued on the subject of charging penal rent.
This has been followed by the Municipal Commissioner's orders
th th
dated 13 January, 2012 and 27 January, 2012. It is stated
that section 64(3) of the MMC Act requires that the Improvement
Committee or the Education Committee or the Standing
Committee may take a decision, but that would be subject to the
approval of the Municipal Corporation. The municipal
administration vests in the General Body and the executive
power vests in the Municipal Commissioner. Hence, the circular
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is in accordance with law. There is a reference to another
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circular dated 5 April, 2013. Thus, the Municipal Corporation
justifies its stand and contends that there is no legal right in the
petitioners, which can be existing in the petitioners. No direction
contrary to law can be issued. Equally, there is a power to
withhold the terminal dues on account of wrongful retention of
the staff quarters. That power is conferred by the circulars. The
argument is that wherever there is silence in the Act and the
rules or regulations, that field is occupied by the administrative
circulars and instructions. They fill the gap and in accordance
with law. These administrative instructions and circulars, so long
as they do not contravene the constitutional mandate nor are
contrary to the law, the parent Act, can be safely relied upon.
Hence, there is no substance to the challenge to the legality of
these circulars.
16. It is to such an affidavit that the petitioners have responded
and by contending that the same is silent on the policy of the
Municipal Corporation to extend the benefits, which are referred
to in the petition. Therefore, once a promise is given to the
municipal employees, who may have retired from the services,
that the quarters allotted to them would be granted on permanent
tenancy basis or ownership basis, then, that assurance or
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promise has to be fulfilled. The Municipal Corporation cannot
back out of the same.
17. It is on these materials that we have heard these petitions.
18. The Municipal Corporation has tendered a compilation
containing the policies, circulars, resolutions and judgments of
this court, whererunder, similar challenge was negatived.
Finally, the Municipal Corporation relies upon the
correspondence on the subject.
19. The thrust of the Municipal Corporations' stand is that the
municipal tenements and staff quarters are public property. No
public property can be disposed of save and except in accordance
with law. The mandate of the MMC Act does not include disposal
of the municipal property in the manner sought by the
petitioners. No tenement can be allotted out of turn or as a
special case save and except in accordance with law, settled
policy and rule of law. Therefore, the retired employees have no
right in the property and they cannot claim that they must be
granted the tenements on permanent ownership basis or
permanent tenancy basis. None of the decisions and relied upon
by the petitioners' counsel can be said to be binding, inasmuch as
the law does not permit the petitioners to rely upon certain
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resolutions and recommendations. Eventually, everything has to
be placed before the General Body of the Municipal Corporation.
The General Body has yet not passed any resolution conferring
any right. Therefore, the policy decision not to grant the
conversion nor to permit retention of the quarters on the above
basis binds the Municipal Corporation.
20. Then, there are other petitions, which have also been
argued. The principal among them is a petition challenging
similar action and enforcement of a promise and assurance.
21. Writ Petition No. 1457 of 2010 pertains to New Khardeo
Nagar Co-operative Housing Society. It is argued by Mr. Nayak.
The other petitions, which were argued are Writ Petition No. 1797
of 2009 and Writ Petition No. 2165 of 2009. Mr. Rupawate
appearing in Writ Petition No. 1797 of 2009 would submit that
the said petition has been filed by an association of the retired
employees or their heirs and legal representatives. These are
retired employees/ex-employees of the Municipal Corporation of
Greater Mumbai. They have been residing in the ground floor
structures of the Municipal Corporation situate at municipal
colonies in the suburbs, namely, Mithanagar (Goregaon),
Barvenagar (Ghatkopar), Parksite (Vikhroli), Malvani (Malad)
and Deonar. The petitioner association has 600 serving and/or
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retired municipal employees. This association has been
registered as Charitable Trust under the Maharashtra Public
Trust Act, 1950 (earlier Bombay Public Trust Act). By this
petition, the petitioners are claiming enforcement or
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implementation of resolution dated 1 September, 1989 of the
Municipal Corporation on the subject of conversion of these
ground floor structures/accommodations from leave and licence
basis to ownership/lease basis to the co-operative housing society.
The petitioners have set out the very checkered history of how
the Mithanagar and Deonar land came to be acquired by the
Municipal Corporation and how the tenements were constructed.
It is claimed that respondent no. 1 constructed 368 tenements at
Goregaon for the purpose of housing dis-housed persons and
allotting the surplus tenements to municipal employees. Though
the scheme was floated, there was no response to accept the
allotment and therefore, as an incentive, respondent no. 1 offered
ownership rights of semi-permanent structures at the
concessional and consolidated price of Rs.4,680/-, if the
occupants form a co-operative housing society. There was
another option for allotment on leave and licence basis.
Mr.Rupawate submitted, during the course of arguments, that the
members of the Sangh belong to the poorest strata of the society.
They could not even afford and arrange the payment of Rs.4680/-
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at that time. That is how they were accommodated and on
sympathetic grounds. It is clear from the record, according to the
petitioners that Deonar land was dumping ground. Some portion
of the land was utilised for housing the municipal employees and
the Municipal Corporation constructed about 582 semi-
permanent structures. Most of them were granted on leave and
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licence basis. By circular dated 31 January, 1968, the
Municipal Corporation offered “Cheap Tenements” at Malvani
Municipal Colony, Malad (West) to the full time municipal
employees on ownership basis. A copy of this circular is annexed
as Exhibit 'B' to the petition. Despite concession, there was no
response and Class III and Class IV municipal employees
preferred to take the allotments on leave and licence basis. The
members of the petitioner association/sangh are Class III and
Class IV employees. They were allotted the ground floor
structures in the municipal colonies on leave and licence basis.
The allotments were made mainly between 1960-1970. One of
the members, namely, Tanaji Ramji Pawar was employed as
'Jamadar'. He was allotted one room in Barvenagar, Ghatkopar
th
(East) by allotment letter dated 14 November, 1973. The
allotment was on leave and licence basis. The municipal fees was
Rs.38.01 per month. The security deposit of Rs.76.02 and
agreement fee of Rs.1/- was recovered from him after execution of
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the leave and licence agreement. The possession of the tenement
was handed over to him. Thus, such an allotment cannot be
termed as allotment of staff quarter/service quarter much less a
service tenancy. This is a leave and licence agreement
simplicitor. No House Rent Allowance was deducted from the
salary and therefore, similarly placed employees can claim the
benefit and in terms of the Municipal Corporation resolution.
22. It is stated that 1211 tenements were constructed at S. G.
Barve Nagar, Ghatkopar (West) in the year 1959-60 for project
affected persons and allotting the surplus 200 tenements to the
municipal employees on leave and licence basis. In the year
1966, the tenements were converted into permanent tenancy
basis subject to payment of the standard rent and furnishing
fresh agreements. Thus, the tenements of the members of the
petitioner sangh were also liable to be converted into permanent
tenancy basis. This proposal was approved by the Deputy
Municipal Commissioner (Improvements) and was communicated
th
by respondent no. 3 by letter dated 24 June, 1966. A copy of the
said letter is annexed as Exhibit 'D'.
23. It is in these circumstances that the Municipal Tenants'
Association represented to the Improvement Committee of the
Municipal Corporation to grant/allot the tenements in such
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colonies on ownership basis. After continuous persuasion, the
second respondent to the petition accepted these proposals. The
Municipal Commissioner, thereafter, disclosed his intention to
grant the tenements at Parksite (Vikhroli), Barvenagar
(Ghatkopar), Mithanagar (Goregaon) and Deonar on ownership
basis. That is how the Municipal Corporation passed Resolution
st
No. 343 dated 1 September, 1989. The original Marathi
resolution and a translated copy thereof in English are annexed
as Exhibits 'E' and 'E-1' respectively.
24. Thus, the conversion was to be effected in terms of this
resolution. However, despite the preliminary work of formation
of a co-operative housing society was completed, the Additional
Municipal Commissioner informed one of the promoters that
some information be provided in terms of his queries raised in the
th
order dated 30 April, 1988, copy of which is at Exhibit 'F'.
th
Thereafter, by another letter dated 27 January, 1990,
addressed by the Ward Officer (Estates) of the Municipal
Corporation, the General Secretary of the proposed co-operative
housing society was informed that their request to convert the
tenements will be considered on compliance of certain
th
requirements. A copy of the said letter dated 27 January, 1990
is annexed as Exhibit 'G'. Similar letters have been addressed in
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November, 1990 and there is compliance therewith by the
th
proposed society on 18 February, 1991. Then, the Senior Ward
Officer (Estates) sought approval of his superiors in December,
1991, so that the conversion can be given effect to. The 20
identical tenements at Malvani Municipal Colony were converted
into ownership from leave and licence basis in pursuance of the
municipal decision and contained in the resolution noted above.
The petitioners rely upon an office note in that behalf. Once the
Malvani Colony was identically placed, then, there is no reason
not to consider the request of the petitioners, made from the year
1990 and pursued throughout.
25. The petitioners do not dispute that there are budgetary
provisions, under which the staff quarters and other tenements
were constructed. Equally, they are aware of the mandate of
section 64 of the MMC Act. However, there is a provision
enabling grant of lease, sale or creating rights in respect of
municipal properties and there is a special power conferred in the
Municipal Commissioner, who can act in accordance with the
sanction of the Municipal Corporation. It is in these
circumstances that the petitioners rely upon their
representations, the outcome of several meetings, the prior
decisions and equally the steps taken with regard to some of the
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tenements in other municipal colonies. The petitioners place
reliance on their representations and the assurance given to
th
them on 20 October, 1989 by the Municipal Corporation. As
required, an offer was submitted by the petitioners. The
petitioners complied with the requisitions and other terms in the
letters of the Municipal Corporation. It is in these circumstances
that the petitioners submit that they were hopeful of the benefits
being granted. They were also hoping that till the outcome of the
proceedings pending in this court, no coercive measures would be
initiated. The petitioners also relied upon certain correspondence
with their architect. It is in these circumstances that the
petitioners concede that their earlier petition could not be
proceeded for want of registration in favour of their association.
The fresh petition now filed is not barred and they only seek
st
enforcement of the Resolution No. 343 dated 1 September, 1989
and every consequence flowing therefrom.
26. To such a petition, there is an affidavit in reply filed by one
Narayan Venkatesh Pai, Assistant Municipal Commissioner
(Estate), in-charge in the employment of the Municipal
Corporation. After reiterating the contents of the similar
affidavit filed in Writ Petition No. 957 of 2013 and the 2010
petition, what has been stated is that there was waiting list of
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10113 employees. They are awaiting regular allotment and 35
employees are awaiting allotment as special cases. The affidavit
explains as to how even the Mayor of the Municipal Corporation
was informed that it will not be possible to consider the request of
the petitioners. The proposals and which were discussed, never
gained any finality. There may be recommendations and
proposals, but there are no firm decisions. It is not as if the
resolution relied upon by the petitioners can be said to be a
decision in itself. That resolution of the Municipal Corporation
has to be considered in the backdrop of the legal provisions and
the powers vesting in the Municipal Commissioner/Corporation.
The resolution passed by the Improvement Committee cannot be
said to be final. It is contended that a policy decision has to be
taken not in terms of this resolution for it is just a
recommendation. It is a recommendation to the Commissioner
for regularisation of the tenancy into ownership basis. The
Municipal Corporation passed a resolution thereby requesting the
Commissioner to regularise the tenancy and that is how the
st
subject Resolution No. 343 dated 1 September, 1989 reads. It
cannot create any right in favour of the petitioners by itself.
st
Rather, the Municipal Commissioner has passed an order on 1
November, 2007 directing retention of 10% amount of the
gratuity of the retired municipal employees and recover the rent
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from the remaining 90% amount. Further, he has decided to
initiate proceedings for their eviction. Thus, there is no policy or
decision either by the Municipal Corporation to convert the staff
quarters into ownership basis or for the retirees to apply for
redevelopment/reconstruction or otherwise under the D. C.
Regulations, 1991.
27. The other petition, namely, Writ Petition No. 2165 of 2009
is also claiming the same reliefs and which is filed by certain
individuals, who are members of the Brihanmumbai Mahapalika
Upnagar Baithi Chawl Rahiwashi Sangh. In terms of identical
pleadings, these petitioners also claim same reliefs. Though we
have not been shown any affidavit in reply specifically filed in
this petition, we can safely say that the stand of the Municipal
Corporation is adequately disclosed in the affidavits filed in reply
to the other petitions.
28. Mr. Rupawate appearing in these two petitions for the
petitioners submits that this is a case where the Municipal
Corporation has itself initiated the proposals. The proposals have
th st
been initiated as early as on 30 April, 1988 and 1 September,
1989. Though the budgetary provision may be claimed to have
been made, but the construction of the premises is not from the
municipal budget. Going by the pleadings of the petitioners, the
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premises cannot be termed as staff quarters. Mr. Rupawate has
invited our attention to the record of pages 62-63 of Writ Petition
No. 1797 of 2009 to submit that the resolution of the
Improvement Committee is not quashed or set aside. It remains
on the record of the Municipal Corporation. The Corporation may
place its interpretation on such resolution, but if the MMC Act is
perused, it is evident that the Improvement Committee is one of
the important committees, through which the municipal
administration and municipal functions are discharged. This
committee is empowered to deal with the municipal estates. Mr.
Rupawate would submit that the Commissioner may write to the
Government in the year 2007 and may seek to resile from this
resolution, but in terms of the proviso to sub-section (3) of section
64 of the MMC Act, so long as a decision is not taken by the State
Government, all the resolutions of the Municipal Corporation are
binding on the respondents. The State Government has not taken
any decision on the Municipal Commissioner's proposal. The
Municipal Commissioner as well has not followed up the matter.
Once the State Government has not replied to the Municipal
Commissioner's letter, then, it is not possible for the Municipal
Corporation to assume that Resolution No.343 is a mere proposal
or recommendation. Our attention is invited to the fact that the
record would indicate that throughout the Municipal Corporation
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was seeking to rely on its own decision and grant the request of
the parties. In that regard, Mr.Rupawate relies upon the
documents at pages 84 to 86 and pages 92 to 96 of the paper
book. He would submit that the record of the petitions from pages
59 to 70 would reveal as to how the Brihanmumbai
Mahanagarpalika has taken a decision to enforce the proposals of
the Improvement Committee. Thus, it is not a mere
recommendation or proposal of the Improvement Committee, but
a final binding decision of the Municipal Corporation, which is
sought to be enforced in this petition. Therefore, the requirement
that the petitioners must possess a pre-existing legal right so as
to seek a writ of mandamus is satisfied. The record would
indicate that the petitioners demanded justice but that was
denied to them. Mr. Rupawate has invited our attention to the
th
letter of the then Municipal Commissioner dated 20 December,
2007, copy of which is annexed to the record of this petition. He
would, therefore, submit that this is not a case where any
sympathy or charity is invoked, but enforcement of a pre-existing
legal right in favour of the petitioners. He would submit that the
writ petitions must succeed.
29. On the other hand, Mr. Sakhare, learned senior counsel
appearing for the Municipal Corporation in these petitions would
submit that the writ petitions have no merit. They must be
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dismissed for they are not founded on any legal right. The
petitioners are not project affected persons or those municipal
tenants whose homes or structures were dilapidated and
therefore, they had to move out for being accommodated by the
Municipal Corporation in distinct or other buildings. The
petitions are filed by ex-employees in the sense they have served
the Municipal Corporation and obtained a service accommodation
during their tenure. These persons, on retirement, have refused
to vacate and handover their tenements to the Corporation. The
Estates Department, therefore, feels acute shortage of housing
accommodation and to house the existing in-service employees.
It is in these circumstances that Mr. Sakhare would submit that it
is immaterial whether the premises are handed over on deduction
of House Rent Allowance or on leave and licence basis. Looked at
from any angle, they are municipal premises/staff quarters and
none can claim a vested right to occupy them. The right to
occupy emanates from the employment with the Municipal
Corporation. Even the allotment is not as of right. It is based on
availability of accommodation and fulfillment of the eligibility
criteria. Having fulfilled that, the municipal employee becomes
entitled to occupy the municipal property. Therefore, he occupies
it as a part of the services, whether as licencee or otherwise, yet,
the property retains its character as “municipal property”.
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30. There can be at best a recommendation or proposal for
sympathetic consideration of the petitioners' plight, particularly
on retirement. The grievance that on retirement such people,
who have served the Municipal Corporation, would be rendered
homeless, has resulted in the proposals being mooted. They
cannot bind the Municipal Corporation. They remain as
recommendations and proposals. No finality is attached to them
for in terms thereof, a decision has to be taken by the competent
authority under the MMC Act. That decision has not been placed
on file. In the circumstances, Mr. Sakhare would submit that
there is no right in the petitioners and the petitions ought to be
dismissed.
31. Even on the second point, Mr. Sakhare would submit that
bearing in mind the conduct of the petitioners, particularly of not
vacating or wrongfully retaining the municipal properties and
premises, the action of withholding their terminal dues has
rightly been taken. They cannot insist on the terminal dues being
released even though their wrongful conduct has caused loss to
the Corporation. That has adversely affected the budgetary
proposals. The payment of pension and gratuity is from public
funds. Therefore, in larger public interest, the Municipal
Corporation has discretion to withhold the terminal benefits. The
argument that under the Payment of Gratuity Act, 1972, no such
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power is conferred in the authority and therefore gratuity and
pension cannot be withheld, would not apply here. In the present
case, the Municipal Corporation of Greater Mumbai has its own
regulations and rules, governing pension and conditions of
service. Therefore, these conditions of service, which prescribe
terminal benefits do not envisage the releasing of the same if
there is a loss caused to the Municipal Corporation. In the
present case, there are municipal dues, which are outstanding.
These petitioners are not entitled to occupy the premises, after
their cessation from municipal services, at a concessional or
lower rate. These petitioners would have to pay the prevailing
market rent. The differential rent has to be recovered and that
can be recovered and adjusted against the terminal benefits.
Therefore, wrongful retention of the Corporation's property must
visit them with such consequences. There is nothing wrongful
and illegal about the act of the Municipal Corporation. The
Payment of Gratuity Act, 1972 is inapplicable to this case. The
right to obtain pension also flows from the Municipal Rules. It is
thus, both benefits, namely, pension and gratuity, can be obtained
only under the Rules of the Municipal Corporation. These rules
enable the Municipal Corporation to effect deductions or make
appropriate adjustments. For all these reasons, he would submit
that the second contention also has no merit.
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32. Alternatively and without prejudice, it is submitted by
Mr.Sakhare that the petitioners have invoked this court's
jurisdiction under Article 226 of the Constitution of India. That
jurisdiction is equitable and discretionary. That jurisdiction
cannot be utilised to grant any benefits or reliefs to a wrongdoer
or a law breaker. This court's jurisdiction is used and utilised by
such persons and even if they cannot obtain substantive relief,
they would walk away with a monetary gain. In such
circumstances, he would submit that the writ jurisdiction cannot
be invoked. They are not entitled for any relief. The writ
petitions be dismissed.
33. Mr. Sakhare has relied upon the compilations, which have
been tendered on behalf of the Municipal Corporation of
documents and judgments. The copies of these compilations have
been handed over to the counsel appearing for the petitioners and
therefore, he would submit that the law of the land is that public
property cannot be retained wrongfully and illegally. Secondly,
for retention of public property wrongfully and illegally, the writ
jurisdiction cannot be utilised and invoked. This court should,
therefore, not grant any relief in favour of the petitioners. Their
petitions be dismissed.
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34. The arguments of Mr. Rupawate and Mr. Sakhare
respectively are adopted by Mr. Nayak and Mr. Pakale.
Mr.Nayak, in addition, has tendered a compilation of judgments
to submit that the pensionary benefits are obtained for services
rendered. He would submit that gratuity and pension is earned
on satisfactory service rendered to the Municipal Corporation.
This is not a charity. The Municipal Corporation is not obliging
the petitioners by paying them pension and gratuity. That is the
petitioners' right. If that is how the matter has to be viewed, then,
irrespective of the conduct of the petitioners, which may be
appearing to be wrongful and illegal to the Corporation, their
terminal dues cannot be withheld. In law, there is no warrant for
such action. Mr. Nayak would, therefore, submit that going by
the law of the land, this action cannot be sustained and the
petitions to that extent deserve to be allowed.
35. As far as the substantive reliefs are concerned, just like any
other municipal property occupants, even the petitioners are
relying on the assurances and promises given to them by the
Municipal Corporation. The Municipal Corporation cannot pick
and choose occupants for granting benefits. If they have granted
certain benefits and to a particular class of occupants, who also
enters the municipal premises initially with some authority and
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later on refuses to handover the same, then, there cannot be a
different treatment to the petitioners. They cannot be picked and
chosen for eviction or recovery by coercive means. Hence, the
mandate of Articles 14 and 16 of the Constitution of India is
violated.
36. Mr. Pakale has invited our attention to the pension
regulations, copy of which has been handed over to us. Mr.Pakale
would submit that the Pension Rules, 1953 have been framed by
the Municipal Corporation. Rule 2 clarifies that these rules apply
to all municipal servants who hold a lien on a permanent post or
would hold a lien on such a post had their lien not been suspended
under the Municipal Service Regulations. These rules do not
apply only to those servants, who are enlisted in Sub-Rule (2) of
Rule 2. However, these rules would apply to a municipal servant,
th
who is in service on 6 June, 1955. Mr. Pakale has referred to
section 81(2) of the MMC Act to submit that these rules have a
statutory force. The word “pension” is defined in these rules and
according to Mr. Pakale, in a comprehensive and wide sense.
That includes gratuity. Therefore, the pension is admissible in
terms of these rules. The gratuity is also admissible in terms of
these rules. Sub-section (5) of Section 4 of the Payment of
Gratuity Act, 1972 indicates as to how nothing in this section
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shall affect the right of an employee to receive better terms of
gratuity under any award or agreement or contract with the
employer. Therefore, the Payment of Gratuity Act, 1972 is
inapplicable. Secondly, all judgments relied upon by Mr. Nayak
are distinguishable. Mr. Pakale would adopt the arguments of
Mr.Sakhare on this point. Additionally, he would submit that as
far as the municipal servants are concerned, they are in a
peculiar position. The State Government/Municipal Corporation
has provided composite monetary/retirement benefits as a civil
security measure to their employees. The employee, who is
covered under the said rules, on his retirement, obtains
substantial amount credited to the GPF Account and pensionary
benefits. The employee makes no monetary contribution towards
the pensionary benefits. Therefore, there is adequate protection
to a retiree from the municipal services. He, therefore, should not
retain the municipal premises after his retirement and again
expect a reward or premium for such an act. All the more,
therefore, the writ petitions be dismissed.
37. Mr. Sakhare and Mr. Pakale have relied upon the following
judgments in support of their above contentions:-
(i) Secretary, ONGC Ltd. and Anr. vs. V. U. Warrier,
(2005) SCC 245.
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(ii) U. P. State Sugar Corporation Ltd. and Ors. vs.
Kamal Swaroop Tondon, (2008) 2 SCC 41.
(iii) Wazir Chand vs. Union of India and Ors., (2001) 6
SCC 596.
(iv) P Rajan Sandhi vs. Union of India and Anr.,
(2010) 10 SCC 338.
(v) Jaswant Singh Gill vs. Bharat Coking Coal
Limited, (2007) 1 SCC 663.
(vi) Ramchandra Keshavrao Paralikar vs. Municipal
Corporation of Greater Mumbai, Writ Petition No. 118
th
of 1983, decided on 5 July, 1990.
38. For properly appreciating the rival contentions, we must
first clear the factual background. We must clarify at once that
this is not a case of those persons who are in occupation of
municipal properties and premises because they are displaced by
a public project and therefore, styled as project affected persons.
They are not the dis-housed occupants of municipal premises
because such premises have become unfit for human inhabitation
by passage of time. These are ex-municipal servicemen or
employees, who have retired from municipal services. During
their tenure, they were allowed to occupy the municipal premises
on account of the specific orders of allotment. The terms and
conditions of this allotment are clear. Even if the allotment of
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municipal premises in favour of the employees is on leave and
licence basis or in lieu of the Housing Rent Allowance, still, the
nature of occupancy remains the same. This occupancy does not
create any right, title or interest in the municipal property, which
is a public property.
39. It is high time that we clarify that those in possession of
public property have no right to continue in their possession and
occupation. The municipal servants must realise, like others,
that they are public servants. The Municipal Corporation must
realise that it is a trustee of the public property. They do not
have authority to dispose of these properties as if they belong to
them exclusively. They are made over to the municipalities for
municipal administration and governance. Therefore, the local
authorities and Municipal Corporations are as much bound by the
mandate of Article 14 of the Constitution of India, as these
employees. This court cannot perpetuate an illegal act by its writ.
Equal protection of the law postulates that those not entitled to
any relief based on a right cannot continue to insist on the same.
Once a leave and licence arrangement in law does not confer any
right, title and interest in the property, much less of tenancy,
then, we do not see how the Municipal property, coming in the
petitioners' possession during the course of their services, places
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them in a different class. They are comparable with those
municipal servants to whom municipal premises are allotted in
lieu of payment of House Rent Allowance. The House Rent
Allowance is paid because those occupying their own or rented
premises should be in a position to bear the monetary liability. In
some cases, the salary is not enough to meet these expenses and
therefore, such schemes, namely, payment of House Rent
Allowance or grant of housing accommodation in lieu thereof, are
proposed and implemented. These schemes are implemented so
as to assist the municipal employees and public servants and in
return, it is expected that they render efficient and prompt
services. The municipal services are rendered to fulfill the
mandate of the constitution of India and Sections 61 and 63 of the
MMC Act. We need not highlight as to what are the duties of the
Municipal Corporation and its functions. There is enough
indication in that regard in the MMC Act itself. That contains
both, the obligatory and discretionary duties. Eventually, all
municipal services are rendered for the welfare and benefit of the
residents of the city. The Municipal Corporations themselves
occupy a constitutional status. The Constitution envisages
establishment and incorporation of a Municipal Corporation so as
to ensure better and quality municipal governance. Given this
status, the municipal employees ought to be aware that if they
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occupy municipal properties during the course of their services,
then, they are also obliged to handover these premises on their
retirement or superannuation so that the Municipal Corporation
can utilise them for housing those who have entered the services
or existing employees. Given the shortage of accommodation,
there is a huge waiting list. Hence, we find that the contrary
impression that parties like the petitioners and municipal
authorities entertain needs to be dispelled forthwith. None can,
therefore, take a decision to handover municipal properties to
anybody save and except in accordance with law. No provision
has been brought to our notice in the MMC Act, which obliges the
Municipal Corporation to make a provision for housing its retired
employees. Therefore, there is no statutory right, which can be
claimed in such matters.
40. The right that has been claimed and sought to be enforced is
based on a decision of the Improvement Committee. The
Improvement Committee is stated to have considered and
sympathetically the request of certain types of occupants of
Municipal Properties. We have been shown several documents in
that regard and from the paper book. It has been pointed out that
though the allotment is made on a specific condition that the
allottee is in municipal service and therefore, he would be
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required to comply with certain conditions, including executing
an agreement and undertaking to handover the premises. Yet, in
1966, some association was informed by the then Deputy
Municipal Commissioner (Improvements) that the request of the
employees, to continue in occupation as tenants on their
retirement, can be accepted. Reliance is placed on the letter
th
dated 24 June, 1966, whereunder, one administrative officer
(Estates) has informed the Secretary of the municipal employees'
association that this Deputy Municipal Commissioner
(Improvement) has approved their request subject to condition
that they pay standard rent and furnish fresh agreement if they
desire to continue to remain in occupation of their tenements. In
this letter, we do not see any decision of the Municipal
Corporation. Then, what is pressed into service is a resolution
and which was passed in the Municipal Corporation's meeting
st st
held on 1 September, 1989. Resolution No. 343 dated 1
September, 1989 refers to the letters of the Commissioner dated
th th
4 July, 1989 and 7 August, 1989. That letter refers to the
plight of the municipal servants, who have been rendered
homeless because of certain developments. That specifically
refers to the condition of the municipal tenements as well.
Therefore, Barvenagar (Ghatkopar), Mithanagar (Goregaon) and
Deonar Municipal Colonies and Parksite (Vikhroli) contain
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structures and singly storeyed. They were granted on leave and
licence basis. However, there is a conversion proposed by the
Municipal Commissioner and on ownership basis. Therefore, the
recommendation of the Municipal Commissioner was placed
before the Municipal Corporation's General Body and that General
Body resolved that these proposals/recommendations of the
Municipal Commissioner can be temporarily approved provided
the co-operative housing society of such occupants presents a
concrete proposal for consideration of the Commissioner and
thereafter the Commissioner forwards it for approval of the
Municipal Corporation. Thus, this is a proposal which has to be
initiated from the Municipal Commissioner. We do not see how
this resolution can be termed as a final decision of the
Corporation to grant permanent occupancy rights. These are not
final recommendations or accepted proposals so as to convert the
individual occupancy into either ownership or permanent
tenancy basis. This is at best a request emanating from all these
occupants, on which the Municipal Commissioner endorses his
remarks and observations and then forwards them to the House.
The General Body has considered them and resolved to accept
them provided fulfillment of certain terms and conditions and
satisfaction of the same by the Municipal Commissioner. In that
event, the House may consider approving the same. Beyond this,
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we do not read anything, much less a vested right, which can be
claimed by the petitioners to continue in occupation and
possession. Once they understand this as only a request made by
them to the Municipal Corporation for consideration of their
cases sympathetically, then, all the more we do not see how
moved by their plight alone, the municipal properties can be
handed over to them permanently. Further, if this court were to
allow such a request and issue the writ as prayed, that would be a
mockery of the rule of law. This court's orders and writ cannot be
contrary to the MMC Act. The municipal property can be
disposed off only in accordance with section 92 of the MMC Act.
The petitioners ought to be aware of this settled legal position and
as annunciated in the MMC Act. No public property can be
disposed off even by a public body except as authorised by law. If
we agree to the request of the petitioner, none would ever vacate
staff or service quarters, but retain them even after their
retirement. Those in public service and fulfilling the criteria of a
public servant would then have to wait for allotment of premises
in the event they require them. We cannot direct a Municipal
Corporation and particularly the Municipal Corporation of
Greater Mumbai, which has a work force of more than one lakh
employees, to grant the permanent occupancies and in the form
requested. We have found from the record that there is no
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dispute that there is a waiting list of employees. There is no
dispute that it becomes difficult for the Municipal Corporation to
house even the staff members who render emergency services.
Thus, those working and serving in the Firebrigade, Water Works
and hospitals, whose presence is required by the establishment
24/7 have to be housed at distant accommodations. In that event,
their availability is a huge question mark and not assured.
Therefore, when their presence is required to meet an emergency,
then, all the more such request as made by the petitioners cannot
be granted. Once the municipal premises have not been allotted
to them independent of their identity as municipal servants, then,
all the more such reliefs as are claimed in these petitions cannot
be granted.
41. Mr. Rupawate would submit that the issue is not covered by
a Single Judge Bench decision of this court, in Writ Petition No.
th
110 of 1983, decided on 5 July, 1990 rendered by Hon'ble
Mr.Justice M. L. Pendse as his Lordship then was. He would
submit that much water has flown after this decision. We do not
see any substance in this contention either. Mr. Rupawate placed
reliance on a letter, which has been addressed by the Municipal
Commissioner of Greater Mumbai to the Government. We have
carefully perused that letter. That letter highlights what we have
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been shown from the records of the present petitions. The
Municipal Corporation has placed before us the entire compilation
of documents, based on which we must consider these cases.
There are as many as five compilations placed before us by the
counsel appearing for the Municipal Corporation. These
compilations contain policies and relevant circulars. We have
carefully considered a policy and which has been stated to be in
force, which is for allotment of staff/service quarters. Rather,
they are the rules of allotment. It is the entitlement of employees,
who have put in 10 years service and their eligibility for
allotment of the staff quarters, which is placed in the forefront,
but the allotment is conditional. The allotment will be on the
basis of seniority in service, taking into account the date of
joining the service. The allottee should execute a leave and
licence agreement. Pausing here, it is apparent that the allotment
of municipal properties or staff quarters to municipal servants is
under these rules. The manner in which the allotment is made is
set out and that envisages a leave and licence agreement as per
the instructions prevailing at the time of the agreement. That
fortifies the position that the licencee has no right, title and
interest in the premises. The licence fees have to be paid by him.
He would render himself liable to departmental action under the
Municipal Service (Conduct and Discipline) Rules for violation of
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the conditions of allotment. The allotment is of a residential
tenement. It is for residence of the employee and his/her family
members. Their names have to be listed in the leave and licence
agreement. Thus, this is a residential accommodation and
granted for residence of the employee and his/her authorized
family members. The terms and conditions indicate as to how
possession of this tenement shall be immediately surrendered to
the concerned Ward Officer on ceasing to be a municipal
employee. Thus, it is not as if post retirement until his/her
obtaining a private accommodation that he can retain the
municipal premises. We do not see any change in this policy.
th
Rather from the rules, though they were revised on 19 March,
2002, what we have noted is, by passage of time, certain
additional terms and conditions have been incorporated and to
take care of those who indulge in irregularities while in
possession of these tenements. By passage of time, the municipal
administration has learnt a lesson and is by now wise enough to
realise that any municipal servant, while in service,
unfortunately expires or is dead, his/her heir or legal
representative is not entitled to continue and reside in the
premises. They would have to vacate the municipal premises
within two months of the death of the employee. It was found that
on sympathetic grounds, extensions are obtained and thereafter,
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the vacant possession thereof is not handed over. It is
unfortunate that the Municipal Corporation had to insert a rule
that if the husband and wife both work in the Department, then,
they would be entitled to only one tenement and allotment may
not be of more than one or two tenements, one in the name of
husband and another in the name of wife. The circulars of the
Municipal Corporation and which have been compiled, indicate as
to how the applications have to be made. One such circular dated
nd th th
2 July, 1990 and subsequent to that of 16 October, 2008, 30
th
October, 2010 and 7 September, 2010 are highlighted by Mr.
Sakhare, because he would submit and rightly that there is
increasing trend of employees not vacating the staff quarters or
to obtain peaceful possession of the municipal tenements. The
circulars empower the Municipal Commissioner and higher
authorities therefore to withhold the retrial benefits of those
retirees who are continuing to occupy the tenements even after
the permissible period. We would advert to this aspect a little
later. What we have noted from these circulars is that when such
authorities are empowered to take a harsh decision, then, all the
more allowing the petitioners to retain the tenements, despite
ceasing to be in service and retiring decades back would, as
rightly contended before us by the Corporation, be putting a
premium on their wrongful and illegal acts. No premium attaches
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to such patent illegality. We cannot, in the garb of any
sympathetic considerations, allow retention of the municipal staff
quarters. What we have further noted is that there are
th
resolutions passed from time to time. On 10 August, 1989, the
Improvement Committee recommended that the Municipal
Commissioner be requested to allot premises on ownership basis
at Barvenagar, Mithanagar, Parksite and Deonar, as per the
decisions contained in the Municipal Commissioner’s letters
th th
dated 4 July, 1989 and 7 August, 1989. These letters set out
the special circumstances for such a decision and also to allot
some of the tenements to project affected persons. The Municipal
Corporation approved this recommendation of the Municipal
st
Commissioner on 1 September, 1989, but mentioning clearly
that these are special factors and circumstances. It had not
passed a firm resolution nor has taken any final and binding
decision. It, as noted above, only directed that the Municipal
Commissioner should forward the necessary proposal specifying
the terms and conditions for allotment for due consideration and
specific approval of the Municipal Corporation. There are further
representations and correspondence, which would indicate as to
how this whole proposal was not found to be feasible. It was not
possible to pick up some tenements in occupation of retired
persons and conferring on them alone the benefit of permanent
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occupancy or tenancy. We have already referred to the
Commissioner’s letter. The Commissioner’s letter, copy of which
is placed before us in this compilation, indicates as to how there is
acute shortage of accommodation. He has, in his detailed letter
addressed to the Government, pointed out that all these persons
while entering the municipal service have undertaken to vacate
the municipal tenements on ceasing to be in municipal services.
Such undertakings and agreements are in force. These
agreements have certain sanctity and a legal efficacy. The
Municipal Corporation is right in insisting that they abide by their
undertakings and voluntarily surrender the premises in their
possession to the Municipal Corporation. Thus, his case was that
by accepting all the terms and conditions, the benefit is obtained
in the form of allotment of staff quarters and municipal premises.
The Municipal Commissioner points out that in the last five
decades or more, new premises could not be constructed by the
Municipal Corporation. It is not possible to obtain any vacant
land or property for construction of new houses. What he has
highlighted is that even if there are Improvement Committee and
General Body recommendations from the year 1989, there is
huge wait list of the municipal employees awaiting allotment of
municipal accommodation. If the existing premises are handed
over on permanent tenancy/ occupancy, then, this wait listed
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employees can never be provided any municipal premises.
Thereafter, he highlights as to how municipal governance is the
primary duty and responsibility of the Municipal Corporation.
The Municipal Corporation serves the residents and members of
the public. The Municipal Corporation is a public body. Those
joining the services of the Corporation and later on retiring from
the services would never surrender or handover the municipal
premises in their occupation. That would set a bad precedent.
The Municipal Corporation's premises and particularly those
vacant lands, which are reserved for construction of residential
structures, have been encroached and it is very difficult to obtain
vacant possession thereof. It is in these circumstances and when
the municipal employees obtain municipal houses, which are
public properties, for their residence, it is their bounden duty to
hand them over to the Municipal Corporation after their
retirement. Converting them into permanent occupancy would
defeat the larger public interest. These nine important points,
which he has highlighted in a detailed letter addressed to the
State Government may have been noticed, but no action one way
or the other has been taken thereon. However, based on that, no
right can be claimed by the petitioners. The State Government is
neither accepting the stand of the Municipal Commissioner set
th
out in his letter dated 20 December, 2007 nor has rejected it.
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Mr. Rupawate has invited our attention to Section 64 of the MMC
Act. That appears under sub heading “Respective Functions of
the several Municipal Authorities”. Section 64 reads as under:-
64. Functions of the several municipal authorities
(1) The respective functions of the several municipal
authorities and of any committee appointed under sections
39, 40, 41, 49A or 50 shall be such as are specifically
prescribed in or under this Act.
(2) Except as in this Act otherwise expressly provided,
the municipal government of Greater Bombay vests in the
corporation.
(2A)On the occurrence of any accident or unforseen event,
or on the threatened occurrence of any disaster, involving
or likely to involve extensive damage to any property of
the Corporation or danger to human or animal life, the
Mayor and the Commissioner with the approval of the
Mayor shall take such immediate action, as the emergency
shall appear to them to justify and require, reporting
forthwith to the Standing Committee or the Corporation,
when they have done so, the action they have taken and
their reasons for taking the same and the cost, if any,
incurred or likely to be incurred in consequence of such
action which is not covered by a current budget grant:
Provided that, in the absence of either the Mayor or
the Commissioner, any one who is present shall take such
immediate decision and action;
(3) Subject, whenever it is in this Act expressly so
directed, to the approval or sanction of the Corporation or
the standing committee or the Improvements Committee,
or the Education Committee and subject also to all other
restrictions, limitations and conditions imposed by this
Act, the entire executive power for purpose of carrying out
the provisions of this Act vests in the Commissioner, who
shall also—
(a) perform all the duties and exercise all the
powers specifically imposed or conferred upon
him by this Act;
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(b) prescribe the duties of, and exercise
supervision and control over, the acts and
proceedings of all municipal officers and
servants, other than the municipal secretary
and the municipal officers and servants
immediately subordinate to him, and subject to
the regulations at the time being in force under
section 81 dispose of all questions relating to
the service of the said officers and servants
and their pay, privileges and allowances;
(c) perform the duties and exercise the
powers imposed or conferred upon the General
Manager by this Act in his absence or on failure
by him to perform or exercise the same.
(d) give such directives to the General
Manager, in the performance of his duties and
exercise of his powers as the Commissioner
may, from time to time, consider necessary.
Where any such directives are given, the
General Manager shall be bound to carry them
out within the period specified in such
directives or within such extended period as
the Commissioner may, suo motu at the
request of the General Manager, permit, so,
however, that the extended period shall not
exceed three months in the aggregate. Where
the General Manager fails to carry out the
directives even within the extended period, the
Commissioner shall entitled to act under clause
(c) above, as if there has been a failure by the
General Manager to perform his duties or
exercise his powers:
Provided that, the Brihan Mumbai Electric
Supply and Transport Committee may by a
resolution passed by a majority of not less than
three-fourths of the total number of its
members restrain the General-Manager from
carrying out any such directive or directives
received by him from the Commissioner; and in
the case of such a restraint, the General
Manager shall not be deemed to have failed in
carrying out any such directive.
(e) be responsible for implementing the
decision of the Corporation, the Standing
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committee, the Improvements Committee, the
Brihan Mumbai Electric Supply and Transport
Committee and the Education Committee:
Provided that, the Corporation, the
Standing committee or any other Committees,
as the case may be, shall obtain and take into
consideration the remarks of the
Commissioner, before making any resolution:
Provided also that, if the Commissioner is
of the opinion that the resolution passed or
decision taken by the Corporation or any of the
Committee is against the provisions of any law,
for the time being in force or may lead to
wastage of municipal fund or seeks to divert
the funds allocated for any of the obligatory
duties of the Corporation to some other
purpose or is against the policy of the State
Government, he may, before implementing the
decision, seek the direction from the State
Government and the State Government shall,
within forty five days from the date of receipt
of such reference may by the Commissioner,
issue direction to the Commissioner whether
such decision should be implemented or not
and the direction issued by the State
Government shall be binding on the
Corporation, or the concerned Committee, as
the case may be.
(3A)Where, any proposal of the Commissioner requires
sanction or approval of any committee constituted under
the provisions of this Act, the committee shall consider
and dispose of any such proposal within forty-five days
reckoned from the date of the meeting of the committee
held immediately after the proposal is received by the
Municipal Secretary, whether the item pertaining to such
proposal is taken on the agenda of such meeting or not,
failing which the sanction or approval to such proposal
shall be deemed to have been given by such committee and
a report to that effect shall be made by the Commissioner
to the corporation:
Provided that, any such deemed sanction or approval
shall be restricted to the extent the proposal conforms to
the provisions of this Act or any other law for the time
being in force.
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(4) Subject whenever expressly so directed in this Act to
the approval of the corporation or the Brihan Mumbai
Electric Supply and Transport Committee and subject also
to all other restrictions, limitations and conditions
imposed by this Act, the entire executive power for the
purpose of carrying out the provisions of Chapter XVIA of
this Act, vests in the General Manager who shall also—
(a) perform all the duties and exercise all the
powers specifically imposed or conferred upon
him by this Act and perform such other duties
in connection with the Brihan Mumbai Electric
Supply and Transport Undertaking as may be
required of him by the Brihan Mumbai Electric
Supply and Transport Committee;
(b) prescribe the duties of, and exercise
supervision and control over the-acts and
proceedings of all municipal officers and
servants appointed under Chapter XVIA and
subject to the regulations for the time being in
force under section 460V, dispose of all
questions relating to the service of the said
officers and servants and their pay, privileges
and allowances;
(c) on the occurrence or threatened
occurrence of any sudden accident for
unforeseen event involving or likely to involve
extensive damage to any property of the
corporation pertaining to the Brihan Mumbai
Electric Supply and Transport Undertaking or
danger to human life arising from or in
connection with any part of that undertaking,
take such immediate action as the emergency
shall appear to him to justify or require,
reporting forthwith to the Briham Mumbai
Electric Supply and Transport Committee,
when he has done so, the action he has taken
and his reason for taking the same and the
amount of cost, if any, incurred or likely to be
incurred in consequence of such action, which
is not covered by a budget grant within the
meaning of that expression as defined in
section 130.
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42. Sub-section (3) of section 64 states that whenever it is in
this Act expressly so directed, subject to the approval or sanction
of the Corporation or the Standing Committee or the
Improvements Committee or the Education Committee and
subject also to all other restrictions, limitations and conditions
imposed by this Act, the entire executive power for the purpose of
carrying out the provisions of this Act vests in the Commissioner
and who shall also perform the duties, which are set out in
clauses (a) to (e) of this sub-section. Thus, the Commissioner
would be responsible for implementing the duties of the Municipal
Corporation. However, if the Commissioner is of the opinion that
the resolution passed or decision taken by the Corporation or any
of its committees is against the provisions of any law, for the time
being in force or may lead to wastage of municipal funds or seek
to divert the funds allocated for any of the obligatory duties of the
Corporation to some other purpose or is against the policy of the
State Government, he may, before implementing the decision,
seek direction from the State Government and the State
Government shall, within forty five days from the date of receipt
of such letter, issue direction to the Commissioner whether such
decision should be implemented or not. We do not see how this
section and with the amendments thereto would alter the legal
position. Rather, if something that requires a specific approval of
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the Municipal Corporation, the Commissioner cannot do that on
his own. Even if there is a resolution of the Municipal
Corporation or a decision taken by it, if that decision is found to
be violating the mandate of law, then, the Commissioner can
move the State Government and ask for it being quashed and set
aside. Merely because the State Government has not acted or
taken any decision, that does not mean that the Commissioner is
bound by the Corporation's decision and which in any event is not
borne out by the record. As held above, there is no decision or
order of the Municipal Corporation accepting the petitioners'
request to convert staff quarters in their occupation and
possession into permanent occupancies. Similarly, as is clear
from Section 92 of the MMC Act, a municipal property, with
respect to its disposal, is governed by the same. It is the
discretion of the Commissioner and as is evidenct from clauses
(a) and (b) of Section 92. Similarly, it is with the sanction of the
Municipal Corporation, the Commissioner may lease, sell or
otherwise convey the immovable property belonging to the
Corporation. After clause (d) appears clause (dd). Thus, what is
clear from these provisions is that a municipal property cannot
be disposed of at the sweet will of the Municipal
Commissioner/Corporation.
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43. With regard to the manner of disposal of such property and
the mandate flowing from Article 14 of the Constitution of India,
the Hon'ble Supreme Court in the case of M. I. Builders Pvt. Ltd.
1
vs. Radhey Shyam Sahu and Ors. held as under:-
66. ….. A bare glance at the terms of agreement shows
that not only that the clauses of the agreement are
unreasonable for the Mahapalika but they are atrocious.
No person of ordinary prudence shall ever enter into such
an agreement. A trustee, which the Mahapalika is, has to
be more cautious, in dealing with its properties. Valuable
land in the heart of commercial area has been handed on
a platter to the builder for it to exploit and to make run
away profits. As a matter of fact on examining the terms
of the agreement we find that Mahapalika has been
completely ousted from the underground shopping
complex for an indefinite period. It has completely
abdicated its functions.
67. To repeat, the agreement is completely one sided
favouring the builder. The land of immense value has been
handed over to it to construct underground shopping
complex in violation of the public trust doctrine and the
Master Plan for the city of Lucknow. Mahapalika has
no right to step in even if there is any violation by the
builder of the terms of the agreement or otherwise.
Mahapalika, though considered to be the owner of the
land, is completely ousted and divested of the land for a
period which is not definite and which depends wholly on
the discretion of the builder. …..
44. In the case of Akhil Bhartiya Upbhokta Congress vs. State of
2
Madhya Pradesh the Hon'ble Supreme Court of India has held
thus:-
“15. The concept of `State' has changed in recent years. In
all democratic dispensations the State has assumed the
role of a regulator and provider of different kinds of
services and benefits to the people like jobs, contracts,
licences, plots of land, mineral rights and social security
1 AIR 1999 SC 2468
2 AIR 2011 SC 1834
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benefits. In his work "The Modern State" MacIver (1964
Paperback Edition) advocated that the State should be
viewed mainly as a service corporation. He highlighted
difference in perception about the theory of State in the
following words:
"To some people State is essentially a class-
structure, "an organization of one class
dominating over the other classes"; others
regard it as an organisation that transcends all
classes and stands for the whole community.
They regard it as a power- system. Some view it
entirely as a legal structure, either in the old
Austinian sense which made it a relationship of
governors and governed, or, in the language of
modern jurisprudence, as a community
"organised for action under legal rules". Some
regard it as no more than a mutual insurance
society, others as the very texture of all our
life. Some class the State as a great
"corporation" and others consider it as
indistinguishable from society itself."
18. For achieving the goals of Justice and Equality set out
in the Preamble, the State and its agencies/
instrumentalities have to function through political
entities and officers/officials at different levels. The laws
enacted by Parliament and State Legislatures bestow upon
them powers for effective implementation of the laws
enacted for creation of an egalitarian society. The exercise
of power by political entities and officers/officials for
providing different kinds of services and benefits to the
people always has an element of discretion, which is
required to be used in larger public interest and for public
good. In principle, no exception can be taken to the use of
discretion by the political functionaries and officers of the
State and/or its agencies/instrumentalities provided that
this is done in a rational and judicious manner without any
discrimination against anyone. In our constitutional
structure, no functionary of the State or public authority
has an absolute or unfettered discretion. The very idea of
unfettered discretion is totally incompatible with the
doctrine of equality enshrined in the Constitution and is an
antithesis to the concept of rule of law.
19. In his work `Administrative Law' (6th) Edition, Prof.
H.W.R. Wade, highlighted distinction between powers of
public authorities and those of private persons in the
following words:
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"... The common theme of all the authorities so
far mentioned is that the notion of absolute or
unfettered discretion is rejected. Statutory
power conferred for public purposes is
conferred as it were upon trust, not absolutely -
that is to say, it can validly be used only in the
right and proper way which Parliament when
conferring it is presumed to have intended.
Although the Crown's lawyers have argued in
numerous cases that unrestricted permissive
language confers unfettered discretion, the
truth is that, in a system based on the rule of
law, unfettered governmental discretion is a
contradiction in terms."
Prof. Wade went on to say:
"...... The whole conception of unfettered
discretion is inappropriate to a public
authority, which possesses powers solely in
order that it may use them for the public good.
There is nothing paradoxical in the
imposition of such legal limits. It would indeed
be paradoxical if they were not imposed. Nor is
this principle an oddity of British or American
law; it is equally prominent in French law. Nor
is it a special restriction which fetters only local
authorities: it applies no less to ministers of the
Crown. Nor is it confined to the sphere of
administration: it operates wherever discretion
is given for some public purpose, for example
where a judge has a discretion to order jury
trial. It is only where powers are given for the
personal benefit of the person empowered that
the discretion is absolute. Plainly this can have
no application in public law.
For the same reasons there should in
principle be no such thing as unreviewable
administrative discretion, which should be just
as much a contradiction in terms as unfettered
discretion. The question which has to be asked
is what is the scope of judicial review, and in a
few special cases the scope for the review of
discretionary decisions may be minimal. It
remains axiomatic that all discretion is capable
of abuse, and that legal limits to every power
are to be found somewhere." (emphasis
supplied)
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31. What needs to be emphasized is that the State and/or
its agencies/instrumentalities cannot give largesse to any
person according to the sweet will and whims of the
political entities and/or officers of the State. Every
action/decision of the State and/or its agencies/
instrumentalities to give largesse or confer benefit must be
founded on a sound, transparent, discernible and well
defined policy, which shall be made known to the public by
publication in the Official Gazette and other recognized
modes of publicity and such policy must be implemented/
executed by adopting a non- discriminatory and non-
arbitrary method irrespective of the class or category of
persons proposed to be benefited by the policy. The
distribution of largesse like allotment of land, grant of
quota, permit licence etc. by the State and its
agencies/instrumentalities should always be done in a fair
and equitable manner and the element of favoritism or
nepotism shall not influence the exercise of discretion, if
any, conferred upon the particular functionary or officer of
the State.
32. We may add that there cannot be any policy, much
less, a rational policy of allotting land on the basis of
applications made by individuals, bodies, organizations or
institutions de hors an invitation or advertisement by the
State or its agency/instrumentality. By entertaining
applications made by individuals, organisations or
institutions for allotment of land or for grant of any other
type of largesse the State cannot exclude other eligible
persons from lodging competing claim. Any allotment of
land or grant of other form of largesse by the State or its
agencies/instrumentalities by treating the exercise as a
private venture is liable to be treated as arbitrary,
discriminatory and an act of favoritism and/or nepotism
violating the soul of the equality clause embodied in Article
14 of the Constitution.
33. This, however, does not mean that the State can never
allot land to the institutions/organisations engaged in
educational, cultural, social or philanthropic activities or
are rendering service to the Society except by way of
auction. Nevertheless, it is necessary to observe that once
a piece of land is earmarked or identified for allotment to
institutions/organisations engaged in any such activity,
the actual exercise of allotment must be done in a manner
consistent with the doctrine of equality. The competent
authority should, as a matter of course, issue an
advertisement incorporating therein the conditions of
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eligibility so as to enable all similarly situated eligible
persons, institutions/organisations to participate in the
process of allotment, whether by way of auction or
otherwise. In a given case the Government may allot land
at a fixed price but in that case also allotment must be
preceded by a wholesome exercise consistent with Article
14 of the Constitution.
34. The allotment of land by the State or its
agencies/instrumentalities to a body/ organization/
institution which carry the tag of caste, community or
religion is not only contrary to the idea of Secular
Democratic Republic but is also fraught with grave danger
of dividing the society on caste or communal lines. The
allotment of land to such bodies/organisations/institutions
on political considerations or by way of favoritism and/or
nepotism or with a view to nurture the vote bank for future
is constitutionally impermissible.”
45. It is not as if a public property is in exclusive domain of the
municipal administrators. It is a public property. Ultimately, all
power is in the nature of a trust. In these circumstances, we
cannot call upon the Commissioner or the Corporation to betray
this trust, which is reposed in them. Eventually, public trust is
paramount in discharge of public duties. We cannot direct the
Municipal Corporation to dispose of the properties after invoking
the above principles. Any decision and equally by us would run
counter to these provisions and the mandate flowing from the
MMC Act.
46. Lastly, what remains for consideration is the second
contention of Mr. Nayak. They would submit that withholding of
terminal/retiral benefits is in the nature of penalty or
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punishment. Merely because the premises have not been handed
over, these terminal benefits cannot be withheld is the argument.
The entitlement to retired or terminal dues has no relation and is
not connected with the conduct of the petitioners post retirement.
Pension and gratuity etc. are rights flowing from rendering of
satisfactory and complete services and therefore, there is no
mandate in law to withhold the pensionary benefits is the further
submission.
47. Mr. Nayak has placed heavy reliance on some decisions in
that regard. He would, firstly, rely upon a judgment of a learned
Single Judge Bench of Delhi High Court in the case of Texmaco
3
Ltd. vs. Ram Dhan and Anr. . That judgment directly interprets
Section 4 of the Payment of Gratuity Act, 1972. That section
reads as under:-
“4. Payment of Gratuity. - (1) Gratuity shall be payable
to an employee on the termination of his employment after
he has rendered continuous service for not less than five
years, -
(a) on his superannuation, or
(b) On his retirement or resignation,
(c) On his death or disablement due to accident or
disease:
Provided that completion of continuous service of five
years shall not be necessary where the termination of the
employment of any employee is due to death or
disablement:
3 Civil Writ Petition No. 1110 of 1989 (Delhi H. C.)
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Provided further that in case of death of the employee,
gratuity payable to him shall be paid to his nominee or, if
no nomination has been made, to his heirs, and where any
such nominees or heirs is minor, the share of such minor,
shall be deposited with the Controlling Authority who shall
invest the same for the benefit of such minor in such bank
or other financial institution, as may be prescribed, until
such minor attains majority.
Explanation. - for the purposes of this section, disablement
means such disablement as incapacitates an employee for
the work which he was capable of performing before the
accident or disease resulting in such disablement.
(2) For every completed year of service or part thereof in
excess of six months, the employer shall pay gratuity to an
employee at the rate of fifteen days wages based on the
rate of wages last drawn by the employee concerned:
Provided that in the case of a piece-rated employee, daily
wages shall be computed on the average of the total wages
received by him for a period of three months immediately
preceding the termination of his employment, and, for this
purpose, the wages paid for any overtime work shall not be
taken into account;
Provided further that in the case of an employee who is
employed in a seasonal establishment, and who is not so
employed throughout the year, the employer shall pay the
gratuity at the rate of seven days' wages for each season.
Explanation. - In the case of a monthly rated employee, the
fifteen days' wages shall be calculated by dividing the
monthly rate of wages last drawn by him by twenty-six and
multiplying the quotient by fifteen.
(3) The amount of gratuity payable to an employee shall
not exceed Ten Lakh rupees.
(4) For the purpose of computing the gratuity payable to
an employee who is employed, after his disablement, on
reduced wages, his wages for the period preceding his
disablement shall be taken to be the wages received by him
during that period, and his wages for the period
subsequent to his disablement shall be taken to be the
wages as so reduced.
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(5) Nothing in this section shall affect the right of an
employee to receive better terms of gratuity under any
award or agreement or contract with the employer.
(6) Notwithstanding anything contained in sub-section (i)
(a) the gratuity of an employee, whose services have
been terminated for any act, wilful omission or
negligence causing any damage or loss to, or destruction
of, property belonging to the employer, shall be forfeited
to the extent of the damage or loss so caused.
(b) the gratuity payable to an employee may be wholly
or partially forfeited
(i) if the services of such employee have been
terminated for his riotous or disorderly conduct or
any other act of violence on his part; or
(ii) if the services of such employee have been
terminated for any act which constitutes an offence
involving moral turpitude, provided that such offence
is committed by him in the course of his employment.”
48. The gratuity shall be payable to an employee on the
termination of his employment after he has rendered continuous
service for not less than five years on his superannuation or on
his retirement or resignation, on his death or disablement due to
accident or disease. The Hon'ble Single Judge was of the opinion
that there has to be something in the Act itself which would
empower withholding gratuity and there being nothing provided
by the Act, withholding of such gratuity for not vacating the staff
or service quarters was in clear contravention thereof.
49. The decision then relied upon by Mr. Nayak in the case of R.
Kapur vs. Director of Inspection (Painting and Publication)
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4
Income Tax and Anr. is also interpreting the provision of
gratuity to a retired Government officer. That was a case where
the death-cum-retirement gratuity was claimed by a Government
servant, who worked and retired as Director General of Income
Tax. While working, he occupied a pooled Central Government
accommodation. The licence fee was fixed at a certain amount.
He had to pay the increased licence fee. Thereafter, he was
transferred to Delhi. However, he continued to retain the
Government premises. During the period of his occupation,
proceedings under the Public Premises (Eviction of Unauthorised
Occupants) Act, 1971 were initiated. The Estate Officer levied
damages. Then, against that, an appeal was filed before the
District Judge. The further proceedings are also referred in the
judgment and order of the tribunal, from which, the appeal to the
Hon'ble Supreme Court arose. The tribunal, on consideration of
all these, held that death-cum-retirement gratuity cannot be
withheld merely because the employee did not vacate the
premises. The absence of any authority in law and power in the
statute or an instrument having force of statute was the focal
issue. The Hon'ble Supreme Court held as under:-
“.....The Tribunal on a consideration of the above held
that death-cum-retirement gratuity (hereinafter
referred to as 'D. C. R. G.') could not be withheld
merely because the employee has not vacated the
4 1994(69) FLR 1137
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allotted premises during the course of his
employment. Inasmuch as the appellant continued to
retain the allotted residence even after retirement,
interest at the rate of 10% could be paid to the
appellant.
As regard the refund of the excess damages i.e.
Rs.1070 for the period 1-10-1979 to 20-11-1981, it
was directed to be refunded and the recovery of
damages could be made under Fundamental Rule 48-
A (iv) (c) (ii) (8).
In this appeal before us the appellant urges that he
would be entitled to 18% interest at least in view of
judgment of this Court in State of Kerala and others v.
M. Padmanabhan Nair 1983 (50) FLR 145 (SC).
Relying on this ruling, it is submitted that there is
unjustified culpable delay in issuing the No Demand
Certificate. The Tribunal having held that D. C. R. G.
cannot be withheld because of the pendency of the
claim for damages should have awarded interest at
the rate of 18% per annum.
The respondent has not entered appearance.
This Court in M. Padmanabhan Nair's (supra) has
held as under:
“Pension and gratuity are no longer any bounty
to be distributed by the Government to its
employees on their retirement but have
become, under the decisions of this Court,
valuable rights and property in their hands and
any culpable delay in settlement and
disbursement thereof must be visited with the
penalty of payment of interest at the current
market rate till actual payment”
The Tribunal having come to the conclusion that D.
C. R. G. cannot be withheld merely because the claim
for damages for unauthorised occupation is pending,
should in our considered opinion, have granted
interest at the rate of 18% since right to gratuity is
not dependent upon the appellant vacating the official
accommodation. Having regard to these
circumstances, we feel that it is a fit case in which the
award of 18% is warranted and it is so ordered. The
D. C. R. G. due to the appellant will carry interest at
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the rate of 18% per annum from 1-6-1986 till the date
of payment. Of course this shall be without prejudice
to the right of the respondent to recover damages
under Fundamental Rule 48-A. Thus, the civil appeal
is allowed. However, there shall be no order as to
costs.”
50. Mr. Nayak, amongst others, also relied upon a judgment in
the case of V. U. Warrier vs. Secretary, Oil and Natural Gas
5
Commission, Dehradun and Anr. . That was a decision rendered
against the Secretary, Oil and Natural Gas Commission (ONGC),
Dehradun and another by this court. The ONGC was aggrieved
and dissatisfied with this decision and carried the matter in
appeal to the Hon'ble Supreme Court of India. That judgment has
6
been expressly reversed by the Hon'ble Supreme Court of India .
In reversing that judgment, the Hon'ble Supreme Court of India
made the following pertinent observations and which are relied
upon by Mr. Sakhare and Mr. Pakale:-
“17. Having heard the learned counsel for the parties, in
our opinion, the appeals deserve to be allowed. It is no
doubt true that pensionary benefits, such as gratuity,
cannot be said to be “bounty”. Ordinarily, therefore,
payment of benefit of gratuity cannot be withheld by an
employer. In the instant case, however, it is the specific
case of the Commission that the Commission is having a
statutory status. In exercise of statutory powers under
Section 32(1) of the Act, regulations known as the Oil and
Natural Gas Commission (Death, Retirement and Terminal
Gratuity) Regulations, 1969 have been framed by the
Commission. In Sukhdev Singh v. Bhagatram Sardar Singh
Raghuvanshi [1975] 1 SCC 421 the Constitution Bench of
this Court held that regulations framed by the Commission
under Section 32 of the Oil and Natural Gas Commission
5 2003(3) Mh. L. J. 168
6 (2005) 5 SCC 245
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Act, 1959 are statutory in nature and they are enforceable
in a court of law. They provide for eligibility of grant of
gratuity, extent of gratuity, etc. Regulation 5 deals with
recovery of dues of the Commission and reads thus :
"5. Recovery of dues. - The appointing authority,
or any other authority empowered by the Commission
in this behalf shall have the right to make recovery of
Commission's dues before the payment of the death-
cum retirement gratuity due in respect of an officer
even without obtaining his consent or without
obtaining the consent of the members of his family in
the case of the deceased officer, as the case may be."
The above regulation leaves no room of doubt that the
Commission has right to effect recovery of its dues from
any officer without his consent from gratuity. In the
present case admittedly the respondent retired after office
hours of February 28, 1990. According to the Commission,
he could be allowed four months' time to occupy the
quarter which was granted to him. His prayer for
extension was considered and rejected stating that it
would not be possible for the Commission to accept the
prayer in view of several officers waiting for quarters. He
was also informed that if he would not vacate the quarter,
penal rent as per the policy of the Commission would be
recovered from him. But the respondent did not vacate the
quarter. It was only after eviction proceedings were
initiated that he vacated the quarter on May 16, 1991. In
the circumstances, in our opinion, it cannot be said that
the action of the Commission was arbitrary, unlawful or
unreasonable. It also cannot be said that the Commission
had no right to withhold gratuity by deducting the amount
which is found “due” to Commission and payable by the
respondent towards penal charges for unauthorized
occupation of the quarter for the period between July 1,
1990 and May 15, 1991.
26. The matter can be considered from another angle
also. It is well-settled that the jurisdiction of the High Court
under Article 226 of the Constitution is equitable and
discretionary. The power under that Article can be
exercised by the High Court "to reach injustice wherever it
is found". More than fifty years before, in G. Veerappa
Pillai v. Raman & Raman Ltd. [1952] SCR 583, the
Constitution Bench of this Court speaking through
Chandrasekhara Aiyer, J., observed (at SCR p. 594) that
the writs referred to in Article 226 of the Constitution are
obviously intended to enable the High Court to issue them
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“in grave cases where the subordinate
tribunals or bodies or officers act wholly
without jurisdiction, or in excess of it, or in
violation of the principles of natural justice, or
refuse to exercise a jurisdiction vested in
them, or there is an error apparent on the face
of the record, and such act, omission, error, or
excess has resulted in manifest injustice.”
(emphasis supplied)
27. Similarly, in the leading case of Sangram Singh v.
Election Tribunal, Kotah [1955] 2 SCR 1, dealing with the
ambit and scope of powers of High Courts under Article
226 of the Constitution, Bose, J., stated: (SCR p. 8)
“That, however, is not to say that the
jurisdiction will be exercised whenever there
is an error of law. The High Courts do not, and
should not, act as Courts of appeal under
Article 226. Their powers are purely
discretionary and though no limits can be
placed upon that discretion it must be
exercised along recognized lines and not
arbitrarily; and one of the limitations imposed
by the Courts on themselves is that they will
not exercise jurisdiction in this class of cases
unless substantial injustice has ensued, or is
likely to ensue. They will not allow themselves
to be turned into Courts of appeal or revision
to set right mere errors of law which do not
occasion injustice in a broad and general
sense, for, though no legislature can impose
limitations on these constitutional powers it is
a sound exercise of discretion to bear in mind
the policy of the legislature to have disputes
about these special rights decided as speedily
as may be. Therefore, writ petitions should not
be lightly entertained in this class of case.”
(emphasis supplied)
The above principle has been reiterated and followed by
this Court in several subsequent cases.
28. As already adverted to by us hereinabove, the facts of
the present case did not deserve interference by the High
Court in exercise of equitable jurisdiction under Article
226 of the Constitution. The respondent-petitioner before
the High Court was a responsible officer holding the post of
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Additional Director (Finance & Accounts). He was, thus,
“gold collar” employee of the Commission. In the capacity
of employee of the Commission, he was allotted a
residential quarter. He reached the age of superannuation
and retired after office hours of 28-2-1990. He was,
therefore, required to vacate the quarter allotted to him by
the Commission. The Commission, as per its policy, granted
four months' time to vacate. He, however, failed to do so.
His prayer for continuing to occupy the quarter was duly
considered and rejected on relevant and germane grounds.
The residential accommodation constructed by him by
taking loan at the concessional rate from the Commission
was leased to Commission, but the possession of that
quarter was restored to him taking into account the fact
that he had retired and now he will have to vacate the
quarter allotted to him by the Commission. In spite of that,
he continued to occupy the quarter ignoring the warning
by the Commission that if he would not vacate latest by 30-
6-1990, penal rent would be charged from him. In our
judgment, considering all these facts, the High Court was
wholly unjustified in exercising extraordinary and
equitable jurisdiction in favour of the petitioner -
respondent herein - and on that ground also, the order
passed by the High Court deserves to be set aside.”
51. According to the Municipal Corporation's counsel, two
principles emerge from this judgment. One is that cases under
the payment of gratuity Act must receive a distinct
interpretation. In the absence of any stipulation in that
enactment, withholding of death-cum-retirement gratuity for
wrongful and illegal occupation or retention of the employer's
premises is impermissible in law. However, there could be cases
where pension and gratuity benefits are better than those
guaranteed by the Payment of Gratuity Act, 1972 and the
Pension Act, 1871. Such better benefits and which are obtained
by employees in terms of settlement, agreement or contract with
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the employer, stand on a different footing. All the more, if there
are conditions attached to the benefit of pension and gratuity,
flowing from such agreement, then, such cases would have to be
considered and viewed differently. Similarly, if there are
regulations, rules or any instruments or circulars/ administrative
instructions, which have a statutory force or which supplement
the statutory enactments, then, the retiral benefits can be
withheld. The second important feature of this judgment,
according to Mr. Sakhare is that this court's equitable and
discretionary jurisdiction should not be exercised so as to benefit
those employees who not only illegally retain the public premises,
but assert that their terminal benefits be released in full, without
any deduction. He would submit that some deterrent has to be
there, failing which, there would be a gross abuse of the equitable
jurisdiction of this court.
52. We see much substance in the contentions of Mr. Sakhare
and Mr. Pakale. In the present case, what we find is that there is
no blanket refusal to release the terminal benefits. There is a
deduction effected therefrom and relying on the circulars of the
Municipal Corporation, empowering the Commissioner to do so.
That the Commissioner resorts to this circular provided he is
satisfied that there is wrongful retention of the premises by
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retiring employees and those superannuated from municipal
services. They have not obtained any right independent of their
status as employees of the Municipal Corporation and rendering
municipal services, which would enable them to retain these
premises. If there is no specific order converting their occupancy
into permanent tenancy or otherwise on ownership basis, then,
they must hand over these premises, else, they must face the
deduction. Even the deduction is to the extent of 10% and the
balance sum is adjusted towards the rent, which can be charged
for such illegal and unauthorised occupancy. The rules and
regulations in that behalf are clear. The conditions of allotment
envisage that in the event the municipal premises are not handed
over within a period of three months after cessation of service,
then, the Municipal Corporation can charge monthly rent, which
can be determined at the prevailing market rate. It is only in
specific contingency such as medical condition and ailment of the
employee concerned that a concession is granted, but that
extends the period of occupation to six months. After that, the
same conditions follow. In the event of sudden and unfortunate
death of an employee in service as well, some concession is
extended. However, if charging and payment of the increased
rent is the obligation and that has to be paid for this extended
occupation, then, we see no justification in the petitioners'
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complaint. They cannot complain that the recoveries cannot be
effected from them for such retention or illegal occupation. They
would thus be benefited by all retiral benefits being handed over
and they would, in turn, continue in possession wrongfully. They
would continue to retain the premises and yet obtain full terminal
benefits. That is certainly something which must be taken note
of. To that extent, we find a distinct departure from the
judgments rendered by this court and the Hon'ble Supreme Court
of India on Payment of Gratuity Act, 1972. The judgment of the
Hon'ble Supreme Court of India was rendered after the
applicability of Payment of Gratuity Act, 1972 was conceded.
However, in later cases, particularly in the case of ONGC (supra),
there is a marked departure. Once there is a specific rule and
regulation enabling the recovery of the amount due from the
retiral benefits, the validity and legality of which is not
challenged, then, no amount of reliance on the Payment of
Gratuity Act, 1972 will assist the petitioners in Writ Petition No.
957 of 2013. the argument of Mr. Nayak therein and on this
point does not arise for consideration in other cases. That issue is
not thus common to all cases. Further, sub-sections (5) and (6) of
the Payment of Gratuity Act, 1972 enable the Municipal
Corporation to rely on its rules and regulations, which have a
statutory force. Even if such rules and regulations are silent with
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regard to withholding of retiral benefits, what the Hon'ble
Supreme Court of India emphasises is that when parties seek
equitable reliefs from this court under Article 226 of the
Constitution of India, then, it is the duty of this court not to grant
such reliefs or not to extend equities and discretion to such
litigants. We, therefore, cannot ignore and brush aside this
binding precedent. We have to strike a balance.
53. We made it clear to the petitioners' counsel that in the event
the petitioners are ready and willing to handover peaceful
possession of their premises within a specific time period, then,
the recoveries and as threatened against them may not come into
effect. There would be no further deductions or if there is any
balance payable post such deduction, it would be released. We
have not found any petitioner voluntarily coming forward and to
give such an undertaking to this court. We are, therefore,
constrained to pass a conditional order in that regard.
54. We, therefore, direct that if such of the petitioners, who
surrender and handover peaceful possession of their premises
(municipal premises in their possession) within three months
from today, the Municipal Corporation shall not make any further
deductions, but release all the balance sums due and payable with
proportionate interest to such employees. In the event the
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petitioners do not handover the premises within this period and
continue to retain them, then, all consequences in law shall
follow. Meaning thereby, the Municipal Corporation can proceed
with its action under section 105B and other provisions of the
MMC Act and recover penal rent/damages/compensation as well.
That can be recovered by attaching movable and immovable
properties of the occupants.
55. However, we have seen a very peculiar feature of this case,
Some of the petitioners have retired long time back. Some of
these petitions have been filed and are pending in this court for
more than five years. In some cases, we have found that this is a
successive round of the litigation. This court has also passed
some orders for protecting possession of the occupants. We
would, therefore, direct the Municipal Corporation not to take
into consideration the pendency of these petitions and the period
during which the interim order was in force, so as to deduct and
adjust the municipal dues in the aforesaid manner. To that
extent, the Municipal Corporation stands restrained from
enforcing its circulars and decisions withholding or seeking to
adjust the retiral dues.
56. We have also found that some assurance, which cannot be
termed as a promise enforceable and within the meaning of
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Section 115 of the Indian Evidence Act, 1872, was extended from
time to time. At least those occupancies from 1960 onwards were
taken into account for consideration and extension of genuine
benefits. These are municipal structures, which have been now in
occupation of these persons for more than four decades. They
have not made any provision for housing in Mumbai, either for
themselves or their family members. In the event the municipal
Corporation decides to develop these properties, particularly at
Parksite (Vikhroli), Deonar (Chembur), Barvenagar (Ghatkopar),
Mithanagar (Goregaon), Malvani (Malad) etc. and in the event
any private party/developer or builder is engaged for
development of these municipal properties/land, then, dependent
upon the agreements that such developers and builders are ready
and willing to execute with the petitioners and take over the
entire responsibility of their re-housing/re-accommodating, then,
the Municipal Corporation shall not, in any manner, prevent the
petitioners from obtaining the benefits under such private
arrangement of their rehabilitation. Even if these persons desire
relocation to other municipal lands, which are
developed/redeveloped, then, even to that course, the Municipal
Corporation shall have no objection nor should prevent them
from obtaining the benefits in terms of the agreement with the
developers. However, we make it clear that it shall not be the
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duty of the Municipal Corporation to provide any housing
accommodation to the petitioners, much less allowing retention of
the present municipal accommodation. Therefore, in the event
such benefits are sought to be obtained by the petitioners
individually or collectively, the Municipal Corporation should
grant them the requisite no-objection certificates/permissions
and shall not withhold them only on the ground that they had
committed default in repayment of municipal dues, not handed
over the municipal properties and premises within a reasonable
time, after retirement. Similarly, because some legal proceedings
have been initiated, that would not be a ground to withhold the
no-objection or consent in the the event that is required or
sought. We also direct that this will have no co-relation and the
petitioners cannot perpetuate and continue their stay in their
premises for they are held to be municipal premises. Once they
assume this character, then, the petitioners cannot retain them
and endlessly. The above advantage or benefit can be availed by
the petitioners only after the municipal premises are handed over
to the Municipal Corporation. This order and direction, therefore,
to the Municipal Corporation is independent of its powers and its
position in law.
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57. To support the view that we have taken, it is necessary to
refer to other judgments relied upon by Mr. Sakhare. Mr.Sakhare
emphasises that the Hon'ble Supreme Court in the case of S. D.
Bandi vs. Divisional Traffic Officer, Karnataka State Road
7
Transport Corporation and Ors. observed that there are rules
like Rule 7 of the Orissa Civil Services (Pension) Rules, 1992,
whereunder, action can be taken for continuing to remain in
occupation of Government premises unauthorisedly. Thus, apart
from initiating proceedings for eviction against serving
Government servant, action by invoking this rule can also be
taken against those who have ceased to be in service.
58. Even with regard to criminal prosecution, the attention of
the Government of India and the State Government was invited to
Section 441 of the Indian Penal Code, 1860 (IPC) as amended by
the Orissa Legislature vide the Penal Code (Orissa Amendment)
Act, 1986 and it was emphasised that this provision enables the
Government to prosecute the offenders for the offence of criminal
trespass and even under Section 447 of the IPC. Thus, it would be
justified even in launching criminal prosecution. Though the
provision in the IPC was recommended to be amended, most of
the State Governments did not evince any interest and therefore,
7 (2011) 15 SCC 718
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that proposal was not pursued by the Hon'ble Supreme Court of
India. It is in these circumstances that we are of the opinion that
it is too late in the day to complain that no adjustments can be
made or that even if adjustments or recoveries are permissible,
they should not be made in the subject case. The Hon'ble
Supreme Court has commented upon the increasing tendency to
hold on to the Government property and termed that there is a
mushroom growth of unauthorised occupation of Government
premises in almost all parts of the country in flagrant violation of
the rules prevailing in the civilised society, which is detrimental
to the interest of a large number of Government servants, who
have been waiting for years together for allotment of Government
premises.
59. We have found that his reliance on a Single Judge Bench
judgment of this court in the case of Ramchandra Keshavrao
Paralikar and Anr. vs. The Municipal Corporation of Greater
8
Bombay is apposite. From the discussion above, it is apparent
that the law has not undergone any change. The learned Single
Judge's view on the aspect and point noted above still holds the
field. We respectfully concur with the same.
8 Writ Petition No. 118 of 1983
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60. As a result of the above discussion, the writ petitions fail.
Rule is discharged in each of them. However, in the facts and
circumstances of the case, there would be no order as to costs.
61. Our order and directions, particularly in relation to the
consideration of the petitioners' request would have to be dealt
with by the Deputy Municipal Commissioner (Improvements) and
subject to the approvals of the further higher authorities.
(B.P.COLABAWALLA, J.) (S.C.DHARMADHIKARI, J.)
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