Full Judgment Text
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.2770 OF 2013
(ARISING OUT OF SLP (CIVIL) NO.355 OF 2010)
Bharat Petroleum Corporation Limited … Appellant
Versus
Rama Chandrashekhar Vaidya & Another …Respondents
WITH
SLP (CIVIL) NO.15 OF 2010
J U D G M E N T
Aftab Alam J .
SLP(C) No.355 of 2010
JUDGMENT
1. Leave granted.
2. The appellant-Bharat Petroleum Corporation Limited, is a Public Sector
Oil Company. In appeal against a decree of eviction, it claims the right to
another innings under section 5(2) of the Burmah Shell (Acquisition of
Undertakings in India) Act, 1976 (hereinafter referred to as “the Act”).
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3. The facts which provide the context for judging the appellant’s claim are
brief and simple.
4. The predecessor of the appellant, namely, Burmah Shell Oil Storage and
Distributing Company of India Limited came in occupation of a piece of land
situated at Kurla, Taluka-South Salsette, District Bombay suburban, now
included in Greater Bombay, admeasuring an area of 19,188 square feet,
bearing Hissa No.1 (part) of Survey No.305 of Kurla (the suit premises) on the
basis of a registered deed of lease dated September 22, 1955. The lease was for
a period of 25 years beginning from March 1, 1955 and further gave to the
lessee [vide. Clause 3 (d)] the unilateral right of renewal for an additional period
of twenty five years by giving a notice in writing two months prior to the
expiration of its term.
5. On January 24, 1976, the Burmah Shell (Acquisition of Undertakings in
India) Act, 1976 came into force and by virtue of section 3 of the Act, the right,
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title and interest of Burmah Shell in relation to its undertakings in India stood
transferred to and vested in the Central Government. Later on, following a
notification issued by the Central Government under section 7(1) of the Act, the
right, title and interest and the liabilities of Burmah Shell in relation to any of its
undertaking in India that had vested in the Central Government were transferred
to and vested in the appellant Company.
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6. A few months before the term of the lease was to come to end, the
appellant, on October 17, 1979 gave a notice to the lessor invoking the renewal
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clause in the lease deed and asking for the renewal of the lease, at the same rent
and upon the same terms and conditions as were contained in the lease, for a
further period of 25 years with effect from March 1, 1980. In the notice it was
also stated that a fresh engrossment of lease was being drawn up for execution
and registration.
7. At this stage, it needs to be noted that though the appellant gave to the
lessor the renewal notice and also continued to occupy the suit premises for the
next twenty five years, no fresh lease deed was actually executed between the
parties and registered in renewal of the previous lease. It also needs to be noted
here that the lessor sent a letter to the appellant on April 24, 1980 stating that
the monthly rent of the suit premises stood increased to Rs.500/- from March 1,
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1980 , but the appellant was remitting rent to the lessor at the old rate of
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Rs.400/- only. The appellant was requested by the letter to pay the differential
amount for the past two months and to pay the future rent at the increased rate
of Rs.500/- per month.
8. As the second twenty five year term was nearing expiry, another notice
for renewal of the lease was given on behalf of the appellant to the lessor on
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Though the notice mentions clause 4(b) of the lease deed, it actually refers to clause 3(d) which is the renewal
clause. Clause 4(b) relates to the determination of the lease on account of the failure of the lessor to obtain a
licence or a renewal in respect of the pump outfit or outfits standing upon the suit premises at the time of
execution of the deed or to be erected and maintained thereupon in future.
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As per the stipulation in the 1955 lease.
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October 7, 2004. This notice was, once again, with reference to the lease deed
dated September 22, 1955. It was stated in the notice that the lease after its
renewal would be expiring on February 28, 2005 and the appellant was desirous
of continuing in occupation of the premises for another period of thirty years.
This notice concluded by observing and claiming as under:
“Since we are in occupation of the site and
carrying on the business of retailing of petroleum
products from the above premises for the last 50
years, and in public interest are desirous of
continuing the business of storing and selling of
petroleum products from the above premises for a
st
further period of 30 years w.e.f. 1 March, 2005 on
the same terms and conditions.”
9. This time the lessor responded by a notice of termination of tenancy dated
March 3, 2005. In this notice, it was stated on behalf of the lessor that the 1955
lease expired on September 21, 1980 but the appellant neither sent any notice
for renewal of the lease period nor the lease in respect of the suit premises, an
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open plot of land, was renewed. Hence, the appellant continued as a month to
month tenant in respect of the open plot of land on payment of rent at the rate of
Rs.500/- per month. The notice further stated that the lessor was not interested
in continuing the monthly tenancy of the appellant and the tenancy was being
terminated by that notice.
10. A reply to the termination notice was given, on behalf of the appellant,
by letter dated March 10, 2005 in which the provisions of sections 5 and 7 of
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the Act were invoked for the first time and a claim was raised for the renewal of
the lease for a further period of 30 years on the same terms and conditions as
contained in the earlier lease.
11. At that stage the respondent – lessor filed a suit for eviction of the
appellant which was registered as T.E. & R Suit No.72/86 of 2005 in the court
of Small Causes at Mumbai. The appellant contested the suit by filing a written
statement and the court of Small Causes by judgment and order dated January
18, 2007 dismissed the suit. The respondent filed an appeal (appeal No.163 of
2007) before the Appellate Bench of the Small Causes Court at Mumbai
challenging the order dismissing the suit. The appeal was allowed by the
Appellate Bench by its judgment and order dated March 5, 2009. Against the
order of the Appellate Bench of the Small Causes Court, the appellant filed a
revision (revision application no.535 of 2009) before the Bombay High Court.
The revision application was dismissed by the High Court by order dated
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October 14, 2009 and the appellant then brought this matter to this Court in
appeal by special leave.
12. Mr. C.A. Sundaram, learned senior counsel appearing for the appellant,
strongly argued that the right of renewal under the lease and the right of renewal
in terms of section 5(2) of the Act are two distinct and separate rights, the
former being contractual and the latter statutory. He further contended that the
two rights being different in nature and arising from different sources could,
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therefore, be exercised separately and successively, independently of each other.
Mr. Sundaram contended that though in the year 1980, the Act had come into
force nevertheless, the appellant chose first to exercise its right of renewal in
terms of the provision in the lease. However, the exercise of the contractual
right of renewal would not abrogate the appellant’s statutory right as provided
under section 5(2) of the Act and at the expiry of the lease renewed in terms of
the contract, it would be still open to the appellant to get a further renewal of the
lease in exercise of the statutory right under section 5(2) of the Act.
13. In support of the submission, Mr. Sundaram relied upon the decisions of
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this Court in Bharat Petroleum Corporation Ltd. v. P. Kesavan and another
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and Hindustan Petroleum Corporation Ltd. And another v. Dolly Das .
14. The decision in P. Kesavan does not touch upon the issues raised by Mr.
Sundaram and does not seem to have any application in the facts of this case. In
P. Kesavan , this Court held that renewal of the lease in terms of section 5(2) of
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the Act takes place by operation of law and the renewal is, therefore, not
dependent upon the execution or registration of a fresh deed of lease. By virtue
of section 5(2), the term of the earlier lease would be deemed to be renewed on
the same terms and conditions on which the earlier lease or tenancy was held
regardless of the execution or registration of a fresh lease deed. This is not the
question arising in the present case.
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(2004) 9 SCC 772
4
(1999) 4 SCC 450
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15. The case of Dolly Das is indeed quite similar to the case in hand on facts
and seems to have given rise to similar issues as arising in this case. But in
Dolly Das , the Court did not adjudicate on the issues and gave certain directions
having regard to the special facts and circumstances of the case. Dolly Das , too,
therefore, is of no help in deciding this case.
16. Therefore, the points urged by Mr. Sundaram need to be examined on
their own merits.
17. On a careful consideration of the matter, we find that though Mr.
Sundaram has crafted his submissions very skilfully, the points raised by him do
not really arise in the facts and circumstances of the case as noted above.
18. The original 1955 lease (which, as a matter of fact, is the only lease deed
that came into existence between the parties) was for a period of 25 years and
was due to expire on February 28, 1980. On October 17, 1979, the appellant
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gave the notice of renewal invoking the renewal clause in the lease deed. In the
renewal notice, there is no reference at all to any provision, much less section
5(2) of the Act. After February 28, 1980, the appellant admittedly continued in
occupation of the suit premises but it is undeniable that no fresh deed of lease
was executed and registered renewing the terms of the previous lease.
19. Now, let us examine what would be the position in the absence of a fresh
deed being executed and registered between the parties. There are only two
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possibilities; one, that the renewal notice was in exercise of the renewal clause
in the lease deed. If that be so, the execution and registration of a fresh deed of
lease was essential for the renewal of lease to take place. (See: State of U.P.
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and others v. Lalji Tandon (dead) through Lrs. paragraphs 13 and 14: Anthony
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v. K.C. Ittoop & Sons and others , paragraphs 8 to 11 and Hardesh Ores (P)
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Ltd. v. Hede and Company , ).
20. In case the renewal was claimed in terms of the stipulation in the lease
deed (described as the “contractual right” by Mr. Sundaram), in the absence of a
fresh deed of renewal, the appellant’s status became that of a month to month
tenant and after twenty five years, in that relationship it would be ludicrous for
the appellant to turn around and claim renewal of lease under section 5(2) of the
Act..
21. Mr. Sundaram made an attempt to argue that it was not a case of renewal
of lease but a case of extension of the term of the lease and in that case no fresh
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deed was required to be executed and registered between the parties. In support
of the submission, he relied upon two decisions of Calcutta High Court, one by
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a division bench in Syed Ali Kaiser v. Mstt. Ayesha Begum and the other by a
learned single Judge of the same court in Ranjit Kumar Dutta v. Tapan Kumar
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(2004) 1 SCC 1
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(2000) 6 SCC 394
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(2007) 5 SCC 614
8
AIR 1977 Calcutta 226
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Shaw . We need not go into the question whether an extension of lease is
permissible in the absence of any fresh deed for the simple reason that this is
unquestionably a case of renewal of lease and not of extension of lease.
22. Thus, in case, renewal was claimed under a clause of the previous lease,
the appellant has no case and the lessor cannot be faulted for terminating the
tenancy by a notice under the Transfer of Property Act, 1882.
23. The other possibility is that though in the renewal notice dated October
17, 1979 there is no reference to section 5(2) of the Act, the renewal must be
deemed to have taken place under that provision because the Act had come into
force on January 24, 1976 and by virtue of section 5(2) of the Act, the renewal
clause of the existing lease stood superseded. If the “renewal”, beginning from
March 1, 1980 is to be deemed under section 5(2) of the Act that would be a
legally valid and correct renewal even in the absence of a fresh deed being
executed between the parties, as was held in P. Kesavan . If that be the position,
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then the appellant has already exercised and exhausted its right under section
5(2) of the Act and there can be no question of a second renewal in terms of the
statutory provision.
24. Thus, viewed from any angle, the appellant cannot claim any further
renewal of lease beyond February 28, 2005.
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AIR 1997 Calcutta 278
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25. In light of the discussions made above, we find no merit in the appeal. It
is, accordingly, dismissed with costs quantified at Rs.50,000/-.
26. However, having regard to the business of the appellant, it is given two
months’ time from the date of the judgment to vacate the suit premises.
SLP(C) No.15/2010.
27. SLP(C) No.15 of 2010 is dismissed for the reasons stated in the judgment
in the connected matter, being Civil Appeal (arising from SLP (C) No. 355 of
2010).
............................................J.
(Aftab Alam)
............................................J.
(Ranjana Prakash Desai)
New Delhi,
April 2, 2013.
JUDGMENT
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IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
I.A. Nos. OF 2013
IN
CIVIL APPEAL No. 2270 OF 2013
(ARISING OUT OF S.L.P. (C) NO.355 OF 2010)
AND
SPECIAL LEAVE PETITION (CIVIL) NO.15 of 2010
Bharat Petroleum Corporation Limited … Appellant
Versus
Rama Chandrashekhar Vaidya & Another …Respondents
O R D E R
These interlocutory applications have been filed by the respondent
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(the landlord) stating that in gross violation of the undertakings given
before the High Court, the petitioner, in connivance with its dealer, has
inducted a rank outsider to the suit premises.
The appeal of the appellant/petitioner (the tenant) is dismissed by the
judgment and order pronounced today.
It will, therefore, be open to the respondent/landlord to get the
decree of eviction passed in his favour duly executed and/or to initiate a
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proceeding for contempt before the Bombay High Court and/or to seek
appropriate reliefs in any other way that may be available to him in law.
The IAs are disposed of.
.........................................J.
(Aftab Alam)
........................................J.
(Ranjana Prakash Desai)
New Delhi,
April 2, 2013.
JUDGMENT
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