SMT. LAKSHMAMMA vs M/S HUAWEI TECHNOLOGIES INDIA PVT LTD.,
- Court
- Karnataka High Court
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COMAP No. 483 of 2025
TH
RESERVED ON 5 JUNE 2026
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
RD
DATED THIS THE 3 DAY OF SEPTEMBER 2026
PRESENT
THE HON'BLE MR. VIBHU BAKHRU, CHIEF JUSTICE
AND
THE HON'BLE MR. JUSTICE C.M. POONACHA
COMMERCIAL APPEAL NO. 483 OF 2025
BETWEEN:
1. SMT. LAKSHMAMMA
AGED ABOUT 75 YEARS
W/O LATE SRI R NARAVANA REDDY
2. SRI HEMAVATHY
AGED ABOUT 55 YEARS
W/O SRI SRINIVAS REDDY
3.
SRI N. VENKATESH REDDY
AGED ABOUT 53 YEARS
W/O. LATE MR. R. NARAYANA REDDY
4. SRI N. SUJATHA
AGED ABOUT 60 YEARS
W/O DR. KESHAV REDDY
5. SMT. N. SHASHIKALA
AGED ABOUT 58 YEARS
W/O DR. VISHWANATH
Digitally
signed by
VEERENDRA
KUMAR K M
Location:
High Court of
Karnataka
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COMAP No. 483 of 2025
6. SMT. N. LAKSHMI
AGED ABOUT 40 YEARS
D/O. LATE SRI R. NARAYANA
7.
SRI VENKATASWAMY REDDY
AGED ABOUT 93 YEARS
S/O LATE SRI DODDAMUNIAPPA
8. SRI V. KODANDA REDDY
AGED ABOUT 71 YEARS
S/O SRI VENKATASWAMY REDDY
9. SRI VEDAVATHY
AGED ABOUT 56 YEARS
W/O SRI V. KODANDA REDDY
10.
SRI M.R. MUNI REDDY
AGED ABOUT 83 YEARS
S/O LATE SRI RAMAIAH REDDY
11. SMT. SARASWATHAMMA
AGED ABOUT 81 YEARS
W/O SRI M.R. MUNI REDDY
12. SMT. M SUDHA
AGED ABOUT 53 YEARS
W/O SRI T. ANAN
13. SMT. MANJULA
AGED ABOUT 51 YEARS
W/O SRI M. LOKESH
14. SRI RAMA REDDY
AGED ABOUT 60 YEARS
S/O SRI M.R. MUNI REDDY
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COMAP No. 483 of 2025
15. SMT. SHOBHA
AGED ABOUT 55 YEARS
D/O SRI M.R. MUNI REDDY
16.
SRI BHUVENDRA REDDY
AGED ABOUT 41 YEARS
S/O SRI M.R. MUNI REDDY
APPELLANTS No.1 TO 16 ARE
REPRESENTED BY THEIR
GENERAL POWER OF ATTORNEY HOLDER
M/S. SHYAMARAJU AND
COMPANY (INDIA) PVT. LTD.,
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
DIVYASREE CHAMBERS
A WING, #11, O'SHAUGNESSY ROAD
BENGALURU - 560 025
REPRESENTED BY ITS AUTHORISED SIGNATORY
MR. RAGHAVENDRA SAANU
17.
M/S. SHYAMARAJU AND
COMPANY (INDIA) PVT. LTD.
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
DIVYASREE CHAMBERS
A WING, #11, O'SHAUGNESSY ROAD
BENGALURU - 560 025
REPRESENTED BY ITS AUTHORISED SIGNATORY
MR. RAGHAVENDRA SAANU
…APPELLANTS
(BY SRI DHYAN CHINNAPPA, SENIOR ADVOCATE A/W
SMT. ANUKANKSHA KALKERI, ADVOCATE)
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COMAP No. 483 of 2025
AND:
1. M/S HUAWEI TECHNOLOGIES INDIA PVT LTD.,
INDIA PVT LTD.,
A COMPANY INCORPORATED UNDER
THE COMPANIES ACT, 1956
HAVING ITS REGISTERED OFFICE AT
SY NO. 36/3 37, 45/1, 45/2,45/3, 45/4,
47/1, 47/2, 137, KNO 1540
KUNDALAHALLLI VILALGE
BENGALURU - 560 037
REPRSENTED BY ITS
AUTHORISED SIGNATORY
MR. OMESH RAINA
…RESPONDENT
(BY SRI G.L. VISHWANATH, SENIOR ADVOCATE A/W
SRI SHIRISH KRISHNA, ADVOCATE)
THIS COMMERCIAL APPEAL IS FILED UNDER SECTION
13 (1-A) OF THE COMMERCIAL COURTS ACT, 2015, PRAYING
TO SET ASIDE THE IMPUGNED JUDGMENT DATED 12.06.2025
PASSED IN COM.O.S.NO.296/2020 BY THE LXXXIX ADDITIONAL
CITY CIVIL AND SESSIONS JUDGE (COMMERCIAL COURT)
(CCH-90), BENGALURU, WHICH IS PRODUCED AT ANNEUXRE
A & ETC.
THIS COMMERCIAL APPEAL HAVING BEEN HEARD AND
RESERVED FOR JUDGMENT, COMING ON FOR
PRONOUNCEMENT THIS DAY, JUDGMENT WAS
PRONOUNCED AS UNDER:
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COMAP No. 483 of 2025
CORAM: HON'BLE MR. VIBHU BAKHRU, CHIEF JUSTICE
and
HON'BLE MR. JUSTICE C.M. POONACHA
C.A.V. JUDGMENT
(PER: HON'BLE MR. VIBHU BAKHRU, CHIEF JUSTICE)
INDEX
INTRODUCTION.......................................................................................5
PREFATORY FACTS................................................................................9
IMPUGNED JUDGMENT ........................................................................18
SUBMISSIONS........................................................................................22
REASONS AND CONCLUSION..............................................................24
*
INTRODUCTION
1. The appellants have filed the present appeal under Section
13(1A) of the Commercial Courts Act, 2015 [ CC Act ] impugning a
judgment dated 12.06.2025 [ the impugned judgment ] passed by
the LXXXIX Additional City Civil and Sessions Judge, (Commercial
Court) (CCH-90), Bengaluru [ Commercial Court ] in
Com.O.S.No.296/2020.
2. The respondent [hereafter 'Huawei' ] had filed the said suit,
praying, inter alia , for a decree directing the appellants No.1 to 16
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COMAP No. 483 of 2025
through appellant No.17 [hereafter ' the Developer '] and the
Developer to execute a sale deed in its favour in respect of the
property described as “Schedule 'A' Property’’ in the Permanent
Perpetual Lease Deed dated 21.10.2005 [hereafter ' PPL '].
3. The said “Schedule 'A' Property’’ is described in the plaint as
part and portion of the property bearing Survey Nos.36/3, 37, 45/1,
45/2, 45/3, 45/4, 46, 47/1, 47/2, 137 at K.No.1540 of Kundalahalli
Village, Bengaluru - 560 037 measuring 15 acres and 23.31 guntas
[hereafter ' “Schedule ‘A’ Property” ']. Huawei also sought a
decree for bifurcation of the khata in respect of the “Schedule ‘A’
Property” and to declare that the defendants have no right to utilise
the Floor Area Ratio/Floor Space Index [ FAR/FSI ] available in
respect of “Schedule ‘A’ Property”. Additionally, Huawei sought a
decree of permanent injunction restraining the appellants (who were
arrayed as defendants) from in any manner utilizing the FAR/FSI
available in respect of “Schedule 'A' Property’’.
4. The appellants No.1 to 16 [ the Landowners ] are the
Landowners of land parcels situated in Kundalahalli Village,
K.R.Puram Hobli, Bengaluru East Taluk and the Developer
(appellant No.17) is a Company incorporated under the Companies
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Act. The Developer is engaged in the business of real estate
development across multiple cities in India. The appellants were
arrayed as defendants in the aforementioned suit filed by Huawei.
5. Huawei is a company incorporated under the provisions of the
Companies Act, 1956 and is a subsidiary of Huawei Technologies
Co. Ltd., China, a leading Global provider of information and
communications technology infrastructure and smart devices and is
engaged in the business of providing telecommunication equipment
and selling consumer electronics, smart phones, etc.
6. The central dispute between the parties is whether Huawei's
rights in respect of the “Schedule 'A' Property’’ are limited to
10,56,000 sq.ft. of super built-up area, irrespective of the FAR/FSI
available in respect of the “Schedule ‘A’ Property”. Huawei claims
that it is entitled to an absolute conveyance of the “Schedule 'A'
Property’’ and is entitled to avail of FAR/FSI in excess of 10,56,000
sq.ft. as may be available in respect of “Schedule 'A' Property’’. It
claims that it is entitled to the mutation of the said “Schedule 'A'
Property’’ in its name as its property with all attendant rights.
7. The Developer, which is also a power of attorney holder of the
Landowners (appellants No.1 to 16) disputes the same. According
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to the Developer, Huawei is entitled to conveyance of the “Schedule
'A' Property’’, but not the right to utilise any FAR/FSI to carry on any
further construction over and above 10,56,000 sq. ft. of super built-
up area. The “Schedule 'A' Property’’ is a part of a larger property
being developed in accordance with the development plan. The said
development plan comprises of various areas including commercial
areas, residential areas, recreational areas and other open areas.
And irrespective of the FAR/FSI that may be available in respect of
the “Schedule 'A' Property’’, Huawei would be entitled only to a
super built-up area of 10,56,000 sq. ft.. Thus, according to the
Developer, although the “Schedule 'A' Property’’ may be conveyed
to Huawei, it cannot develop or construct floor space in excess of
10,56,000 sq. ft. of super built-up area.
8. It is common ground that the said dispute is required to be
addressed in reference to the written agreements entered into
between the parties. The learned Senior Counsel appearing for the
parties advanced submissions solely on the basis of the written
documents. Therefore, in view of the above, the dispute essentially
relates to the interpretation of the agreements between the parties.
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PREFATORY FACTS
9. The Developer, with the objective of developing a large-scale,
mixed use integrated development project comprising of residential
apartment complex along with various amenities and facilities in the
Whitefield area and the Kundalahalli locality of Bengaluru, initiated
negotiations with the owners of several individual land parcels,
namely, Appellants No.1 to 16. The intention underlying these
negotiations was to amalgamate and develop the Landowners'
parcels with the Developer's own holdings under a unified master
plan, which came to be known as "DivyaSree Technopark."
10. The Landowners comprise two principal groups. The first
group consists of Appellants No.1 to 9. They are the absolute
owners of immovable properties, out of which they offered lands
measuring 25 acres 39 guntas and 22 acres 3.5 guntas [hereinafter
collectively referred to as "land parcel 1" ] for development. The
second group comprising of Appellants No.10 to 16 are the absolute
owners of immovable properties, out of which they offered lands
measuring 9 acres 24 guntas and 10 acres 6.5 guntas [hereinafter
collectively referred to as "land parcel 2" ]. In addition, the
Developer is the absolute owner of land measuring approximately 4
Acres 35 Guntas [hereinafter referred to as "land parcel 3" ]. The
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land parcels 1, 2 and 3, collectively measure approximately 72
Acres 28 Guntas (inclusive of 11 Guntas of converted and 9 Guntas
of unconverted kharab land) and form a contiguous block of land
[hereinafter referred to as "the larger property" ].
11. The Landowners executed Joint Development Agreements
and General Powers of Attorney in favour of the Developer,
authorising it to develop the larger property as a unified integrated
project and to represent and bind the Landowners in all transactions
pertaining thereto.
12. The Developer and Huawei entered into negotiations
regarding the development of Huawei's proposed campus on the
land as part of the DivyaSree Technopark. Huawei addressed a
letter of its expression of interest [ LOI ] for the land for the
construction and development of Huawei's campus, confirming its
interest in developing its campus on the land offered by the
Developer at DivyaSree Technopark and in executing appropriate
contracts on mutually agreed terms. The LOI also recorded
Huawei's interest in developing about 10,56,000 sq. ft. of super
built-up area on about 20 acres of land.
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13. On 10.08.2005 Huawei and the Developer entered into a
agreement amending the LOI (Ex. D4). It recorded that the land
falling in Survey No.47/3 had not been converted for
‑
non agricultural use and provided that, pending its conversion, the
said land would be excluded from the perpetual lease deed and be
covered by a separate agreement to lease.
14. Subsequently, on 21.10.2005, the parties also entered into an
agreement to lease (Ex. D6) in respect of an area of 2 acres and 9
guntas (39 guntas in Survey No.47/3 and 1 acre 10 guntas in
Survey No.48), which was earmarked as the Future Development
Area.” In this agreement, the Developer/Landowners agreed to
complete all ongoing proceedings and formalities to ensure that the
Landowners have full and absolute title and all interests in the
‘Future Development Area’ and to ensure that the agricultural
property is converted for non-agricultural use in terms of the
provisions of the Karnataka Land Revenue Act, 1964 as well as to
obtain the change of land use under the Karnataka Town and
Country Planning Act, 1961 to commercial (software).
15. The Landowners, represented by the Developer, executed the
PPL on 21.10.2005 in respect of the land measuring 17 acres and
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COMAP No. 483 of 2025
31 guntas [ demised property ] on the terms and conditions set out
in the PPL. In consideration, Huawei paid a total sum of
` 58,61,00,000/- (Rupees fifty eight crores sixty one lakhs only) to
the Developer, comprising a premium of ` 58,50,00,000/- (Rupees
fifty eight crores fifty lakhs only) and an interest-free refundable
security deposit of ` 11,00,000/- (Rupees eleven lakhs only). A sum
of ` 2,00,00,000/- (Rupees two crores only) was paid by cheque
bearing No.574261 dated 06.06.2005, drawn on HSBC Bank,
`
Bengaluru; 51,89,00,000/- (Rupees fifty one crores eighty nine
lakhs only) was paid by cheque bearing No.575597 dated
26.10.2005, drawn on HSBC Bank, Bengaluru; ` 11,00,000/-
(Rupees eleven lakhs only) was paid as an interest-free refundable
security by cheque bearing No.575598 dated 26.10.2005; and the
balance amount of ` 4,61,00,000/- (Rupees four crores sixty one
lakhs only) was paid by cheque bearing No.488063 dated
28.10.2014.
16. Huawei took over possession of the “Schedule ‘A’ Property”
and claims it has been paying the property tax in respect of the said
“Schedule ‘A’ Property” since 2005.
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17. A portion of the demised property was earmarked by the
Bangalore Development Authority [ BDA ] for the construction of 24
meter wide road under the Revised Master Plan, 2015.
Consequently, on 30.06.2008, the Developer executed a
relinquishment deed (Ex P6) for land measuring 8870 square
meters (approximately 2 acres 7.67 guntas) in favour of the BDA.
The said parcel of land was a part of the land demised to Huawei
under the PPL. Consequently the land demised to Huawei was
reduced to approximately 15 acres and 23.31 guntas (“Schedule ‘A’
Property”).
18. On 25.06.2009, the Developer and Huawei entered into a
Memorandum of Understanding (Ex.D8), whereby the Developer
agreed to assist Huawei to obtain all necessary approvals from
various authorities including Bruhat Bengaluru Mahanagara Palike
[ BBMP ], BDA, Karnataka State Pollution Control Board [ KSPCB ],
Bharat Sanchar Nigam Limited [ BSNL ], etc.
19. On 25.01.2010, Huawei and the Developer entered into a
memorandum of understanding (Ex.D10), whereby the Developer
agreed to assist Huawei for obtaining the development plan for
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block H1, H2, H3, H4 and H5, which form part of the Huawei’s
campus.
20. On 10.03.2011, Huawei and the Developer entered into a
construction management contract (Ex.D12), whereby the
Developer agreed to render services as a construction manager.
21. On 17.12.2014, BBMP issued a partial occupancy certificate
in respect of the buildings constructed on the “Schedule ‘A’
Property”.
22. At the material time, Huawei had constructed approximately
9,76,207 sq. ft. of super built-up area. On 30.12.2015, the
Developer secured a re-modified development plan (Ex.P9/D17)
from BDA in respect of the larger property including the “Schedule
‘A’ Property”.
23. After the expiry of twelve years from the date of execution of
the PPL, Huawei sought conveyance of the “Schedule ‘A’ Property”
in its favour by calling upon the appellants to execute the sale deed
and to register the same.
24. Several meetings were held between the representatives of
Huawei and the Developer regarding Huawei’s demand. According
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to the Developer, whilst it expressed its willingness to execute a
sale deed in respect of the “Schedule ‘A’ Property”, it clarified that
the same would be subject to the condition that the FAR/FSI
entitlement over the “Schedule ‘A’ Property” would be confined to
10,56,000 sq. ft. of super built-up area in terms of the LOI and the
PPL.
25. Huawei sent a draft sale deed by an email dated 17.11.2017
demanding conveyance of the “Schedule ‘A’ Property” without any
restriction. It specified that Huawei would be entitled to the entire
FAR/FSI in respect of the said property. Huawei also sought the
right to bifurcate the khata of the “Schedule ‘A’ Property” and
exclude it from the re-modified Development Plan, 2015 (Ex D17). It
also retained the right to furnish any further plans that it may desire
in future for further development of the “Schedule ‘A’ Property”.
26. Given the impasse between the parties, Huawei and the
Developer held discussions between November 2017 and March
2018. The Developer also shared a revised draft sale deed, which it
claimed was consistent with the parties’ agreement (the LOI and the
PPL).
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27. On 29.05.2018, the parties met again to discuss the draft
revised sale deed circulated by the Developer. However, on
30.07.2018, Huawei revised the draft sale deed as proposed by the
Developer and reiterated its demand for full rights, including the
right to utilise the applicable FAR/FSI in respect of the leased land
without any restriction.
28. Thereafter, Huawei caused legal notice dated 17.02.2020
(Ex.P16) to be sent to the Developer calling upon it to execute the
sale deed in line with the draft circulated by it. The Developer
responded to the legal notice by a letter dated 12.06.2020
reiterating that Huawei’s claim was contrary to the terms of the LOI
and PPL.
29. Thereafter, Huawei instituted pre-institution mediation under
Section 12A of the CC Act before the District Legal Services
Authority, Bengaluru. However, the said mediation was
unsuccessful and the said authority issued a non-starter report
dated 29.09.2020, which was communicated to the parties on
13.10.2020.
30. Huawei instituted the aforementioned suit on 22.10.2020
(Com.O.S.No.296/2020), inter alia , praying as under:
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a) Direct Defendant Nos.1 to 16 through
Defendant No.17 and Defendant No. 17 to
execute a Sale Deed in favour of the Plaintiff in
respect of the Suit “Schedule ‘A’ Property”, as
denoted in the Permanent Perpetual Lease
dated October 21, 2005;
b) Direct Defendant Nos.1 to 16 through
Defendant No.17 and Defendant No. 17 to
execute the Sale Deed in terms of the draft sale
deed issued along with the Legal Notice dated
February 17, 2020 and produced as Document
No. 30;
c) Direct Defendant Nos.1 to 16 through
Defendant No.17 and Defendant No. 17 to
bifurcate the khata in respect of the Suit
“Schedule ‘A’ Property”, as denoted in the
Permanent Perpetual Lease dated October 21,
2005;
d) Declare that the Defendant Nos.1 to 16 through
Defendant No. 17 and Defendant No. 17 have
no right to utilize the FAR/FSI available in the
Suit “Schedule ‘A’ Property” as per the
Permanent Perpetual lease dated October 21,
2005 in respect of the Suit “Schedule ‘A’
Property”;
e) Grant a permanent injunction against the
Defendant Nos.1 to 16 and Defendant No.17
jointly or severally, their agents, workers,
employees, assignees, representatives or any
one claiming through or under any of them from
acting in any manner to utilize the FAR/FSI
which is available as per the Permanent
Perpetual Lease dated October 21, 2005; in
respect of the Suit “Schedule ‘A’ Property”;
f) Grant a Permanent Injunction against the
Defendant Nos.1 to 16 and Defendant No.17
jointly or severally, their agents, workers,
employees, assignees, representatives or
anyone claiming through or under any of them
from interfering with the Plaintiff’s peaceful
possession and enjoyment of the Suit Schedule
A and B Property as per the Permanent
Perpetual Lease dated October 21, 2005;
g) Award costs of the suit;
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h) Grant such other relief/s as this Hon’ble Court
deems fit in the facts and aforementioned
circumstances, in interests of justice and equity.
31. The parties led their respective evidence and the suit was
disposed of by the impugned judgment.
IMPUGNED JUDGMENT
32. The learned Commercial Court framed the following issues for
consideration:
1. “Whether the Plaintiff proves that the
Defendant No:1 to 16 through Defendant No:17
and defendant No:17 have deliberately failed to
execute and register the sale deed as per the
terms and condition of the Permanent Perpetual
Lease deed dated:21.10.2005?
2. Whether the Plaintiff proves that the
defendants No:1 to 16 through Defendant No:17;
and Defendant No:17 are liable to execute and
register the Sale deed in respect of Suit “Schedule
‘A’ Property” in terms of the draft sale deed issued
along with Legal Notice dated:17.02.2020?
3. Whether the Plaintiff proves that the
defendants No:1 to 16 through Defendant No:17;
and Defendant No:17 are liable to bifurcate the
Khata in respect of Suit “Schedule ‘A’ Property” as
contemplated under Permanent Perpetual Lease
dated:21.10.2005?
4. Whether the plaintiff proves that the
defendants No:1 to 16 through Defendant No:17
have no right to utilize the FAR/FSI available in the
Suit “Schedule ‘A’ Property” as per the Permanent
Perpetual Lease dated:21.10.2005 in respect of
Suit “Schedule ‘A’ Property”?
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5. Whether the defendants No:1 to 16 through
Defendant No:17 proves that the defendant No:17
is absolutely entitled to use and utilize and has
already used and utilized all balance FAR/FSI
exceeding 10,56,000 Sq.ft. of super built-up area
available in suit Schedule A Project for its project
DivyaSree techno park forming part of the larger
property?
6. Whether the defendants No:1 to 16 through
Defendant No:17 proves that the plaintiff is not
entitled to have any right/interest in respect
FAR/FSI exceeding 10,56,000 Sq.ft. of super built-
up area available in suit “Schedule ‘A’ Property”?
7. Whether the Plaintiff proves that it has been
and always ready and willing and in fact has
complied with its obligations under the Permanent
Perpetual Lease deed dated:21.10.2005?
8. Whether the Plaintiff is entitled to have
specific performance of Permanent Perpetual
Lease deed dated:21.10.2005 to have the sale
deed executed and registered in its favor in
respect of Suit “Schedule ‘A’ Property”?
9. Whether the Plaintiff is entitled for the relief
of Permanent Injunction to restrain the defendants
No.1 to 16 through Defendant No:17 and
Defendant No:17 jointly or severally or through
their agents, workers employees, assignees,
representatives or anyone claiming through or
under them from utilizing the FAR/FSI which is
available as per the Permanent Perpetual Lease
deed dated:21.10.2005 in respect of Suit
“Schedule ‘A’ Property”?
10. Whether the Plaintiff is entitled for the relief
of Permanent Injunction to restrain the defendants
No.1 to 16 through Defendant No:17 and
Defendant No:17 jointly or severally or through
their agents, workers employees, assignees,
representatives or anyone claiming through or
under them from interfering with plaintiff’s peaceful
possession and enjoyment of Suit “Schedule ‘A’
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Property” as per Permanent Perpetual Lease deed
dated:21.10.2005?
11. What Order/decree?”
33. The learned Commercial Court found merit in Huawei's claim
that it was entitled to conveyance of the leased property in terms of
the draft sale deed furnished by it.
34. A plain reading of the impugned judgment indicates that the
learned Commercial Court based its conclusion on the interpretation
of clause 9 of the PPL (Ex.P24).
35. The Learned Commercial Court held that clause 9 of the PPL
contains a non obstante clause which would override other clauses
of PPL. The said clause, inter alia , provided that Huawei would
acquire absolute ownership of the “Schedule ‘A’ Property” after 12
years from the date of the PPL.
36. The learned Commercial Court also referred to the minutes of
the meeting held on 02.11.2017 (Ex.P34) and noted that the said
minutes evidence that the Developer had not raised any query
regarding transferring absolute rights to the “Schedule ‘A’ Property”
by executing the necessary deeds.
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37. The learned Commercial Court noted that the LOI and
documents executed prior to the PPL could not be looked into in
view of clause 15 of the PPL, which expressly provided that it
superseded earlier documents.
38. The learned Commercial Court on the basis of the evidence
concluded that the Developer had failed to establish that it had
utilised the entire FAR/FSI over the larger property.
39. In view of the aforesaid findings, the learned Commercial
Court decreed the suit and directed the Landowners acting through
the Developer and the Developer to execute a sale deed in favour of
Huawei in respect of the “Schedule ‘A’ Property” as detailed in the
PPL and in terms of the draft sale deed sent by Huawei along with
its legal notice dated 17.02.2020. The learned Commercial Court
also declared that the defendants have no right to utilise the balance
FAR/FSI in excess of 10,56,000 sq. ft. available in the Schedule A
Property; directed bifurcation of the khata within ninety days;
restrained the defendants by permanent injunction from utilising the
said balance FAR/FSI and from interfering with Huawei's
possession of the Schedule A and B properties; and provided that,
in default of execution, Huawei would be at liberty to have the sale
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deed executed through a Court Commissioner. The suit was
decreed with costs.
SUBMISSIONS
40. Sri. Dhyan Chinappa, the learned Senior Counsel appearing
for the appellants (Landowners and the Developer) contended that a
plain reading of the documents clearly evidences that the parties
always intended that Huawei would have the right to construct its
own buildings only to an extent of 10,56,000 sq. ft. of super built up
area and not exceeding the same. And, the Developer had the
absolute right to utilise any FAR/FSI exceeding the said area. He
contended that Huawei wanted a built-up area of 10,56,000 sq. ft.
and the said area was accommodated as a part of a larger
development plan. He contended that even if the FAR/FSI available
on “Schedule ‘A’ Property” was less than 10,56,000 sq. ft., Huawei
would be entitled to the said area, which would necessarily have to
be accommodated by utilisation of FAR/FSI of the remaining area in
the larger property.
41. He referred to the Joint Development Agreement dated
21.03.2005 and submitted that the project envisaged was an
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integrated project/complex over a larger property of which the
“Schedule ‘A’ Property” was a part.
42. He then referred to the LOI and submitted that the said LOI
expressly recorded Huawei’s interest to develop a proposed
campus on the land as a part of the DivyaSree Technopark, and it
was not Huawei’s intention to acquire any property in excess of
10,56,000 sq. ft. super built-up area.
43. He contended that the terms of the PPL must be read in
context of the agreement between the parties as recorded in the LOI
and the PPL. He referred to clause 6 of the PPL, which restricted
Huawei’s right to construct to 10,56,000 sq. ft. super built-up area.
He also referred to clause 7 of the PPL and contended that the
same clearly sets out the understanding between the parties.
44. He submitted that clause 9 of the PPL had been erroneously
interpreted to completely obliterate other clauses of the PPL. He
contended that it is well settled that although a non obstante clause
would override other clauses, it would be necessary to ascertain the
extent to which the non obstante clause would operate.
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COMAP No. 483 of 2025
45. Sri. G.L. Vishwanath, the learned Senior Counsel appearing
for Huawei contended that the terms of clause 9 were clear and
entitled Huawei to all residuary and reversionary rights. He
submitted that the same implied that the Developer and the
Landowners could not hold any right in respect of the “Schedule ‘A’
Property” on its conveyance.
REASONS AND CONCLUSION
46. As is apparent from the above, the dispute largely centres on
the interpretation of the PPL and on ascertaining the agreement
between the parties. The learned Commercial Court had framed
several issues. However, it identified that the main issues which fell
for consideration were whether both the parties had agreed that
Huawei's entitlement to own, possess, develop and construct on the
subject property is restricted to 10,56,000 sq. ft and the parties had
agreed that the FAR/FSI generated from subject property could be
utilised by the Developer for development of DivyaSree Technopark;
or whether in terms of clause 9 of the PPL, Huawei was entitled to
utilise the balance FAR/FSI over and above 10,56,000 sq. ft
applicable to the subject property.
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COMAP No. 483 of 2025
47. The learned Commercial Court found in favour of Huawei.
The court’s conclusion was based on the non obstante clause in
Clause 9 of the PPL and its literal interpretation. The same was
dispositive of the disputes between the parties.
48. Huawei’s case is that no other documents or agreements are
required to be considered alongside the PPL, as it overrides prior
agreements. However, in our view, it would be necessary to
examine the various documents to understand the context in which
the parties executed the PPL. Whilst the dispute essentially relates
to the interpretation of the PPL, the context in which it was executed
cannot be disregarded when determining the commercial
understanding between the parties.
49. Huawei desired to construct a campus for software
development and, in that context, had engaged in discussions with
the Developer. As noted above, the Developer had entered into
Joint Development Agreements with the Landowners (Exhibit P1
and Exhibit P2) to aggregate land and develop an Integrated
Complex. Under the Joint Development Agreements, the
Landowners appointed the Developer exclusively as a designated
contractor with the right to attend to and complete, in all respects,
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COMAP No. 483 of 2025
the construction of an Integrated Complex in phases on the larger
property on a turnkey basis and to transfer the same.
50. The Landowners had agreed that in consideration of the
Developer constructing and delivering the agreed built-up space
free from all encumbrances, they would transfer and convey the
Developer's share of the larger property to the Developer.
51. We may for the present purposes refer to some of the
relevant clauses of the Joint Development Agreement (Exhibit P1)
dated 21.03.2005, which are set out below:
ΑΡΡΟΙΝΤΜΕ
" 1. NT AS CONTRACTOR
/DEVELOPER
The Owners hereby appoint the Developer
exclusively as the designated Contractors and
authorize the Developers for the purpose of and
having the right to attend to and complete In all
respects and secure the construction and put up
the said Integrated Complex In phases on the
Schedule Property on a turnkey basis and market
and transfer the same.
4. SANCTIONED PLANS AND CHANGE OF
LAND USE / CONVERSION
The Developer at its sole discretion, depending on
the market conditions and Its requirements, shall be
responsible for the preparation of all plans for
development and the design of the integrated
complex to be constructed on the Schedule
Property and for securing all necessary approvals,
permissions, sanctions, consents from all
authorities having jurisdiction, Including necessary
change of land use and sanction of building plans
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COMAP No. 483 of 2025
for the construction of the said Integrated Complex.
The entire cost and expenditure Incurred for
change of land use and sanction for construction
and development shall be borne by the Developer.
The Owners hereby permit the Developer to
secure, Inter alia, sanction and permission for
development of the said Integrated Complex from
statutory and other authorities.
The Owners shall use their best endeavors to
co-operate with and assist the Developer in
procuring such approvals and sanctions as and
when required by the Developer.
5. CONSTRUCTION OF INTEGRATED COMPLEX
The Developer is entitled to design and build the
maximum feasible Floor Area Ratio (FAR)
permissible under the Building regulations and
construct such number of Buildings on the
Schedule Property as the Developer may decide
considering the market conditions and
requirements and for proper development of the
Integrated Complex. The Developer will be entitled
to take up the development in various phases and
structure the same in one or more parcels, which
may share some common resources and facilities
and may have certain exclusive resources and
facilities earmarked for use by buildings located
within an identified area and or for exclusive use of
certain Identified occupiers or users and may
transfer certain demarcated areas absolutely or
with specified Interest to certain occupiers. The
Owners have also agreed that the Developer will be
entitled to acquire Transferable Development
Rights (TDR) pursuant to which a higher FAR
would be available or club the Schedule Property
with other adjacent properties, whether owned or
acquired in future by the Developer themselves or
owned by third parties who have also agreed to
provide their respective properties for development
to the Developer and develop the entire property as
a larger mixed development with shared
Infrastructure roads and facilities to take advantage
of the FAR of the entire clubbed properties as a
whole with flexibility of using the FAR of a parcel of
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COMAP No. 483 of 2025
land in any other area of the clubbed property
and/or leaving open areas or roads for common or
exclusive use on certain parcel of land and
constructing denser construction on other parcels
of lands, so long as the Owners receive the
consideration provided in this agreement by the
Developer and the Owners are allocated a
proportionate and variable un-divided Interest in the
total clubbed property to allow full and proper use
and enjoyment of the total built up area agreed to
be allocated to the Owners in terms of this
agreement and Irrespective of the total built up area
to be constructed on the clubbed property
(hereinafter called the "Clubbed Properties") from
time to time as determined in accordance with the
formula set out hereunder and such proportionate
variable un-divided Interest as determined by the
formula is called Un-Divided Interest elsewhere in
this agreement;
The Developer shall develop the Schedule Property
and any Clubbed Properties, if any and put up the
Integrated Complex in Phases. The Developer shall
be entitled to progressively expand within the
Schedule Property and the Clubbed Properties, if
any. Similarly if any exclusive areas are allocated to
any person exclusively, with such person utilizing
any specified portions of the common areas, then
the Total Built-up Space will reduce and The UDI
percentage may Increase accordingly. The details
of the phased take-up shall be determined by the
Developer from time to time so long as the Owners
are provided the Owners' Built-up Space and
related undivided Interest in the Schedule Property
within the agreed deadlines as stated in this
agreement. During such period the Owners agree
not to offer the property to any third party or
encumber the same in any manner whatsoever.
6. PAYMENT OF REFUNDABLE DEPOSIT /
CONSIDERATION / TRANSFER OF
DEVELOPERS SHARE OF UNDIVIDED
INTEREST
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COMAP No. 483 of 2025
The Developer has already paid an aggregate sum
of Rs. 12,74,578.64/- (Rupees twelve lakhs seventy
four thousand five hundred seventy eight and paise
sixty four only) to the Owners on account of Interest
free refundable Deposit, which sum will be
refunded by the Owners to the Developer upon
completion of the development by the Developer
and at the time of hand over of the Owners' Built-up
Space (along with the Un-Divided Interest in the
Schedule Property to the Owners or any of their
nominees and/or authorized representatives.
In consideration of the Developer agreeing to
develop, construct and deliver the Owner's Built-up
Space free from all encumbrances and to provide
all the services in order to put up construction from
the stage of planning, approvals, payment of fee to
Consultants, Architect or any other person or
service provider required for completion of the said
Integrated Complex on the Schedule Property, the
Owners shall be bound to transfer and convey the
Developers' share of the Schedule Property In
favour of the Developer or its nominees pursuant to
the terms of this agreement. As the Integrated
Complex is proposed to be developed in stages,
and In various blocks, the Parties have agreed that
the Developer is entitled to cause completion of the
Owners' Built-up Space in one or more stages, and
also deliver the Owners' Built-up Space In stages
and consequently the Developer shall be entitled to
transfer and convey the Developers' Share of the
Schedule Property in the same proportion as the
delivered portion of the Owner's Built-up Space has
to the total agreed Owners' Built-up Space. The
Developer shall be entitled to utilize the power
granted to the Developer to transfer Interest in the
Schedule Property In terms of this Agreement to
transfer and convey the Developers' share of the
Schedule Property to third parties without any
further reference to the Owners."
52. It is apparent from the above that the understanding between
the Landowners and the Developer was that the parcels of land
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COMAP No. 483 of 2025
would be clubbed, and an Integrated Complex would be developed
on the entire land. Huawei was fully aware of the said Joint
Development Agreements and the intent to develop an Integrated
Complex on the larger property. It thus follows that the discussions
between the Developer and Huawei were in the aforesaid backdrop.
1
Pursuant to the discussions, Huawei issued the LOI dated
31.05.2005. It is important to examine the contents of the said LOI
as it sets out the broad parameters on which Huawei had proceeded
to engage with the Developer. The opening paragraphs of the said
LOI reads as under:
"Further to our various discussions with regard to
the development of the proposed campus for
Huawei (the "Campus"), we are happy to confirm
our interest in developing the Campus on the
land offered by you at 'DivyaSree Technopark" ,
subject to execution of appropriate contracts on
mutually agreed terms, based on the broad terms
and conditions contained in this LOI.
Our interest is in the development of about
10,56,000 sq. ft. of super built up area as per the
designs to be provided by us, in an extent of
about 20 (Twenty) acres of land in parts of
Survey 36/3, 37, 45/1, 45/2, 45/3, 45/4, 46, 47/1,
47/2, 47/3, 48 and 137 of Kundalahalli Village,
coming under the Mahadevapura CMC Limits in
Bangalore and forming part of your project
DivyaSree Technopark. You have represented to
us, that the said lands are the absolute property,
free of encumbrances, of the persons mentioned in
1
Ex D3
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COMAP No. 483 of 2025
Annexure A to this LOI (hereinafter the "Owners"),
who are also in sole and exclusive possession
thereof and have entered into a Joint Development
Agreement with you." [emphasis added]
53. It is clear from the above that Huawei was interested in
developing its campus on lands that were part of the 'DivyaSree
Technopark’. Admittedly, the 'DivyaSree Technopark’ is an
Integrated Complex on the larger property. Huawei had
unequivocally expressed that its interest was to develop about
10,56,000 sq. ft. of super built-up area as per its design over an
extent of about 20 acres of land which formed a part of the mixed
development project –'DivyaSree Technopark'. The LOI also set out
the representations made to Huawei.
54. Paragraphs 1 to 6 of the said LOI are relevant and are set out
below:
"1. That you have entered into a Joint
Development Agreement with the Owners and
certain others, for the development, inter alia, of an
area of totally about 70 (Seventy) acres, (which
includes the aforesaid area required for our
Campus) for commercial purposes, namely, as a
Software Development Park to be called
"DivyaSree Technopark” (copy whereof is annexed
to this LOI as Annexure D) and that the owners and
others concerned will be executing irrevocable
Powers of Attorneys for the purpose in your favour
or in favour of your nominees and all other
documentation, as may be required, sufficient to
enable you to comply with the terms and conditions
of this LOI.
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COMAP No. 483 of 2025
2. That from out of the overall area aforesaid of the
proposed DivyaSree Technopark, you have already
got change of land use for commercial purpose, in
respect of an area of about 23 (Twenty three) acres
to make it suitable for use for the aforesaid
purpose. The overall area proposed for the
DivyaSree Technopark project is shown in the
Master Plan attached to this LOI as Plan A.
3. That you are in a position to arrange and make
available for our use for the Huawei Campus, the
area required by us, being the area more
particularly described in Annexure B annexed
hereto and delineated in red in Plan B (hereinafter
the "Said Lands").
4. That based on the relevant applicable legal
provisions you have assured us that you are in
a position to arrange for the construction of the
10,56,000 sq. ft. of super built up area required
for our Campus on the Said Lands and that you
are entitled to utilize the remaining FSI / FAR in
the adjoining lands of the DivyaSree
Technopark .
5. That in order to achieve the foregoing, the
Said Lands will be demised to us as and by way
of permanent perpetual lease, with full and
exclusive occupation and enjoyment rights and
with full heritable and alienable rights (save and
except only, that Huawei will not be entitled to
construct more than the 10,56,000 sq. ft. of
super built up area proposed for the Huawei
campus) and with the option of purchasing the
absolute title to the Said Lands as hereinafter
provided. You have also assured us, that
notwithstanding the arrangements you have
with the Owners with respect of the rest of the
DivyaSree Technopark areas, with respect to
the Said Lands to be leased to us as aforesaid,
absolute title thereto will be held by the current
Owners or yourselves, with no undivided
interest or other rights for any others, save and
except only your right aforesaid to utilize the
excess FSI/FAR within the DivyaSree
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COMAP No. 483 of 2025
Technopark either by yourselves or any of your
group companies.
6. That you will arrange to satisfy us fully about the
title of the Said Lands and your right to contract and
make available to us the Said Lands as and by way
of permanent perpetual lease and its suitability for
construction of the 10,56,000 Sq.ft. of our campus
and that you will also arrange, within 60 (Sixty)
days of the date of this LOI, for the execution and
registration in our favour of all documentation and
papers required by us to effectively demise the
Said Lands to us as and by way of permanent
perpetual lease on the terms contained in this letter
and other terms mutually agreed, by the Owners
and others concerned, or on their respective behalf
by duly authorized persons and also simultaneously
put us in vacant unencumbered possession of the
Said Lands."
55. The LOI also recorded the details of the proposed transaction.
Some of the relevant clauses of the LOI are reproduced below:
“16. Further details of the proposed transaction
are as follows:
a) Type of Documents to be executed.
Permanent Perpetual Lease with full heritable and
alienable rights, for the Said Lands, with an option
on the part of Huawei to get residuary reversionary
rights as well and full and absolute title to the Said
Lands through a Sale Agreement and Sale Deed
when Huawei exercise the option to buy the Said
Lands, at the earliest of:
(i) Completion of the DivyaSree Technopark project
or
(ii) 12 (Twelve) years from the date of this LOI, or
(iii) in the event that transfer of the Development
Rights (TDR) has been made available by the
concerned Government Authority and Huawei has
transferred its rights with respect to the excess
FSI/FAR (beyond 10,56,000 sq. ft.) in respect of the
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COMAP No. 483 of 2025
Said Lands to SRIPL. Construction/Development
Agreement.
Any other Document as may be specified by us or
our Legal Consultants, subject to mutual agreement
of the terms thereof.
b) Area: Extent of Land. The total extent of the
Said Lands will be 20 (Twenty) acres, for the
construction by us of
10,56,000 sq ft of super built up area, including
separate and independent direct access from the
Said Lands to the public road as indicated in Plan B
attached to this LOI, you have assured us that 14.6
acres of this area has been duly approved by BDA
for use for commercial (Software Park) purposes.
The remaining 5.4 acres is currently approved for
use for residential purpose and SRIPL undertakes,
at its own risk and cost, to obtain the approval from
BDA and other concerned authorities for Change of
Land use to commercial (Software Park) use, as
and when so required by Huawei and within an
agreed time line. You have also specifically
represented to and assured us, that it is possible to
legitimately construct the 10,56,000 sq. ft. of super
built up area required by us, on the Said Lands.
Based on these specific representations and
assurances, Huawei is agreeable to the following
mode of transfer, which SRIPL undertakes to
arrange and facilitate:
(i) The Said Lands will be transferred to Huawei
through a duly stamped and registered permanent
perpetual Lease Deed executed by the Owners or,
if Huawei so agrees, by their duly authorized
attorneys, accompanied with vacant and
unhindered possession, with irrevocable heritable
and alienable rights and full and unhindered
right to develop and improve the Said Lands by
construction and absolute ownership of
10,56,000 sq. ft. of super built up area
constructed to house our Campus in
accordance with the approved plans and
sanctions. It is agreed and understood between
both the parties, that the overall construction
right of Huawei in the Said Lands is not to
exceed 10,56,000 sq. ft. of super built up area.
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COMAP No. 483 of 2025
The said lease deed will also specifically
provide for an option on the part of Huawei, to
get absolute and unencumbered rights and title
to the Said Lands, at the earliest of: (i)
completion of the DivyaSree Technopark
project, or (ii) 12 (Twelve) years from the date of
this LOI, or (iii) in the event that transfer of the
Development Rights (TDR) has been made
available by the concerned Government
Authority and Huawei has transferred its rights
with respect to the excess FSI/FAR to SRIPL
The right of Huawei as aforesaid to obtain full and
absolute unencumbered title and rights to the Said
Lands is a condition of the contract between the
parties and, in the event of any failure or default by
SRIPL to execute or cause to be executed by the
Owners the required sale deed(s) and other
documents for the purpose, Huawei shall be
entitled to Specific Performance of the aforesaid
obligation under taken by Developer, by specifically
enforcing the same through a court of law,
irrespective of, and notwithstanding, any of the
clauses and understanding covered in the
Development Agreement or any other contract,
between SRIPL and the land Owners or any others
whomsoever.
(ii) Other appropriate documents as required
will also be executed / registered and actions
taken by SRIPL / Owners, to ensure, that we
have the full rights for the construction,
ownership and use of 10,56,000 sq. ft. of super
built up area for the Campus. All Documents
will be on terms acceptable to both of us and
with a view to fulfill the intent and purpose of
this LOI .
c) *
d) Development Agreement. Huawei intends to
construct super built up area of 6,00,000 sq ft
facility in Phase I and super built up area of
3,00,000 sq ft in Phase II on the Said Lands, as
more clearly outlined in Annexure C of this LOI,
subject to Huawei complying with item e) below.
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COMAP No. 483 of 2025
The remaining 1,56,000 sq ft of construction will be
taken up by Huawei at any time and at their sole
discretion.
The Campus also includes a residential apartment
for use by the staff of Huawei. The apartment will
also be built as part of the Phase I and, wherever
required, SRIPL will assist and undertake the
suitable construction model viz - Residential or
Commercial. The scope of construction and
development covers all the civil, services, fit-out
and exterior development for the facilities through
SRIPL as general contractor on the following
commercial terms.
The scope of development work and the specific
services to be provided by SRIPL, the schedule for
work and services, and the payment terms, as well
as all other general and specific information, shall
be covered under the Construction and
Development Agreement.
e) *
f) Un-utilized FSI. Huawei intends to construct the
total super built up area of 10,56,000 sq ft
(6,00,000 sq ft in Phase I, 3,00,000 sq ft in Phase II
and 1,56,000 sq ft at any time thereafter) in the
Said Lands. Any permissible super built up area
beyond 10,56,000 sq ft in the Said Lands will be
available to SRIPL, but only for use in adjoining
areas of the DivyaSree Technopark. It is clarified
that on no account will any constructions be
permitted on the Said Lands, other than the
10,56,000 sq. ft. proposed for the Huawei Campus.
g) CM Fee for final 1,56,000 Sq ft building
As and when Huawei intends to construct building
of the balance 1,56,000 sq. ft. SRIPL will be given a
first right of refusal for the construction
management thereof on terms decided by Huawei.
The fee for providing the said construction
management services will be between 9 to 11% of
the project development cost, negotiable at the
time.
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COMAP No. 483 of 2025
In the event SRIPL is not willing/able to take up the
CM, alternate CM Consultant will be engaged by
Huawei in consultation with SRIPL.”
56. It is material to note that paragraph 16 (a) of the LOI records
the understanding, which is also reflected in clause 9 of the PPL.
57. The LOI was subsequently amended by an agreement
( Ex.D4) dated 10.08.2005, as the land falling under Survey No.47/3
had not been converted for non-agricultural use. Therefore, the said
land was required to be excluded pending its conversion.
58. On 21.10.2005, Huawei and the Developer also entered into
an agreement (Ex. D5) in furtherance of the LOI, as amended by the
agreement dated 10.08.2005 (Ex. D4), and the PPL. As noted
above, the area of 2 acres and 9 guntas falling in Survey No.47/3
(39 guntas) and Survey No.48 (1 acre and 10 guntas) had been
excluded from the demised property pending its conversion and was
earmarked as the Future Development Area . The said agreement
(Ex D5) also recorded Huawei's intention to construct 6,00,000 sq.
ft. of super built-up area in Phase I and 3,00,000 sq. ft. in Phase II
as outlined in the Design Brief annexed to the said agreement. The
construction of the remaining 1,56,000 sq. ft. would be taken up
subsequently at Huawei’s discretion.
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COMAP No. 483 of 2025
59. Sub-para (i) of paragraph 3 of the said agreement is set out
below:
(i) Huawei intends to construct at its own cost, a
facility, having a super built up area of 600,000 sq
ft in Phase I and a super built up area of 300,000
sq ft in Phase II, as more clearly outlined in the
Design Brief annexed hereto as Annexure G. The
remaining 1,56,000 sq ft of construction will be
taken up by Huawei at any time and at their sole
discretion."
60. The parties had also entered into other agreements and
deeds regarding consultancy and management. However, the same
may not be relevant for the purpose of addressing the present
dispute.
61. The parties entered into the PPL ( Ex P24 ) on 21.10.2005.
Under the said PPL, the Landowners agreed and confirmed that the
2
Demised Property as well as the Future Development Area (2
acres and 9 guntas in Survey Nos.47/3 and 48) would fall to the
share of the Developer under the Joint Development Agreements
( Ex.P1 & Ex.P2) . The Landowners thereby confirmed that the
Developer had the right to deal with the same in terms of the Joint
Development Agreements. Huawei agreed to pay an amount of
2
Land measuring 17 acres and 31 guntas falling in Sy no 36/3,37,45/1,45/2 & 45/3, 45/4,
46, 47/1, 47/2 and 137 of Kundalahalli Village
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COMAP No. 483 of 2025
` 58,50,00,000/- by way of a premium and a further sum of
` 11,00,000/- as interest free refundable security deposit in
consideration for entering into the PPL. It was agreed that the
balance premium of ` 4,61,00,000/- (Rupees Four crores and sixty
one lakhs only) shall be paid at the earlier of:
“(a) execution and registration of the deed of
permanent perpetual lease in respect of the Future
Development Area in favour of the Lessee, in
terms of the separate agreement being executed
amongst Lessors No. 1 to 9, the Developer and
the Lessee; or
(b) expiry of one month from the date on which, in
terms of the said agreement, the
Lessors/Developer are able and willing to execute
and register the said deed of permanent perpetual
lease in respect of the Future Development Area
in favour of the Lessee; or
(c) expiry of eighteen (18) months from
commencement of construction of the Lessee's
campus on the Schedule Property.”
62. The relevant clauses of the said agreement are set out below:
"6. The Lessee doth hereby covenant with the
Lessors/Developer as follows:
a) to construct and erect and own, not more than
an aggregate super built up area of 10,56,000 sq.
ft. on the entire Schedule Property and/or Future
Development Area, at its own cost in terms of
designs and specifications as deemed fit by the
Lessee and to permit the Lessors/Developer, to
utilize any balance FAR / FSI available in respect of
the Schedule Property (over and above 10,56,000
sq. ft.) on the properties of the Lessors/Developer
adjoining the Schedule Property, and to build on
such adjoining properties any corresponding further
super built up area (over and above the said
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COMAP No. 483 of 2025
10,56,000 sq. ft.) now permissible, or made
available in the future, In respect of the Schedule
Property and Future Development Area, as per the
laws, rules and building regulations and the
amendments thereof, if any, applicable from time to
time. For the removal of doubt it is agreed and
recorded, that there shall be no reduction of the
Lessee's right and entitlement to construct and own
10,56,000 sq. ft. of super built up space as
aforesaid on account of the Lessee not taking or
getting perpetual leasehold rights and/or absolute
ownership of the Future Development Area.
Accordingly, in the event that, for any reason
whatsoever, the Lessee does not get such
perpetual leasehold rights of the Future
Development Area before January 31, 2006, the
Lessee shall have the right to utilize, construct and
own Its said entitlement of 10,56,000 sq. ft. of super
built up space on the Schedule Property subject to
clause 13 below. This right shall, however, be
without prejudice to the continued right of the
Lessee to get the permanent perpetual lease of the
Future Development Area, under and In
accordance with the separate agreement between
the Lessee and the Lessors/Developer in respect of
Future Development Area. It is agreed and
acknowledged, that the measurement and
computation of the super built up area of 10,56,000
sq. ft. aforesaid will, for all purposes, be made as
per the prevailing regulations and practices of the
concerned governmental authority.
b) In order to facilitate the foregoing and subject to
Clause 7 hereinafter provided, not to seek or be
entitled to bifurcation/partition of the khata of the
Schedule Property from its existing khata until the
earliest of the events specified in Clause 9
hereinafter provided; Provided that the Lessee will
be entitled to apply for a leasehold Khata in respect
of the Schedule Property without affecting the rights
of the Lessors/Developer to use any
additional/balance FAR / FSI as provided In Clause
6(a) above.
c) To pay to the concerned authorities or, as the
case may be, re-imburse to the Lessors/Developer,
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COMAP No. 483 of 2025
all taxes, rates, assessments and other levies
whatsoever in respect of the Schedule Property
and all constructions and improvements thereon,
for any periods falling after the date of this Deed of
Permanent Perpetual Lease and comply with all
notices that may be issued by any Jurisdictional
authority, without prejudice to any of the Lessee's
rights to take recourse to all available legal
remedies, appeals and other proceedings against
such notices; In the absence of the Municipal
Authorities determining the amount payable in
respect of the Schedule Property separately without
bifurcation of the Khata, the Lessee shall be liable
to so pay or reimburse, as the case may be, such
proportionate amount as may be determined by the
Parties as relateable to the Schedule Property,
having regard to the total assessment made in
respect of the entire Khata and the nature of use
and areas covered under the Schedule Property as
prevailing at the time of payment of such taxes.
d) To comply with all applicable laws, rules and
regulations with respect to the excavation of any
stones, sand, gravel, clay or earth from the
Schedule Property for execution of construction of
the Huawei campus and the buildings, structures
and adjuncts thereto.
e) to maintain the Schedule Property and all
constructions and improvements thereon in good
order and condition at its cost and expenses.
f) not to do or permit to be done in the Schedule
Property or any constructions therein, any act,
deed, matter or thing which may cause nuisance,
annoyance or disturbance to any others in the
vicinity or which may affect the rights of the
Lessors/Developer with respect to the balance FAR
/ FSI (ie., over and above the Lessee's right to
construct and own 10,56,000 sq. ft. of super built
up space), as provided in Clause 6(a) above,
and/or against the rules, regulations and laws of the
local authorities or any state or central laws.
g) To keep indemnified the Lessors and the
Developer from and against any and all actions,
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COMAP No. 483 of 2025
suits, proceedings, claims, demands, fines,
penalties, costs, expenses and other liabilities,
consequences and obligations whatsoever, that
may be made or suffered by or brought against or
incurred by the Lessors and/or the Developer by
reason or by virtue of, any default or violation of the
Lessee, (other than acts of God or force majeure
not within the control of the Lessee) or the non-
observance or breach by the Lessee, of its
obligations, covenants or assurances herein
contained or of any law, rule, regulation, bye law or
other legal requirement, in respect of the Schedule
Property, which may arise after this perpetual lease
deed is duly signed and registered.
h) Not to object to the Developer assigning its
development rights in respect of any balance FAR /
FSI available in respect of the Schedule Property
(over and above 10,56,000 sq. ft.), wholly or in part,
to any nominee, provided that the Lessee's rights
and interest over the Schedule Property as vested
in the Lessee under this Deed of Permanent
Perpetual Lease are fully protected by the
Lessors/Developer and no rights or interest
adverse to the Lessee's rights herein are purported
to be set up or created or assigned by the
Lessors/Developer or their nominees or assignees
in any manner whatsoever. It is made clear that by
virtue of use or transfer of any balance FAR / FSI
no undivided interest shall be created in favour of
any user or transferee, in the Schedule Property.
i) To execute and admit the execution of such
documents/deeds as may be required, and to
comply with all requirements, for transfer of
Lessors/Developer's right with regard to the excess
FSI/FAR as aforesaid (over and above 10,56,000
sq. ft. of built up area on the Schedule Property and
Future Development Area) in favour of
Lessors/Developer or any of their nominee/s, at the
request and cost of the Lessors/Developer.
j) To pay for the maintenance of the common areas
of the DivyaSree Technopark on a proportionate
basis, along with all other occupants of the
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DivyaSree Technopark, as may be agreed by
execution of a separate agreement.
7. The Lessors and the Developer do hereby jointly
and severally covenant with the Lessee as follows:
*
(f) that the Lessee will have full, proper,
unhindered and permanent perpetual leasehold
rights and interest over the Schedule Property and
every part and portion thereof on the terms herein
provided (Including without limitation the right and
authority to sub lease the whole or any portion of
the Schedule Property and to alienate, lease or part
with possession of any constructions or
improvements made by the Lessee thereon) and
may hold and enjoy the same in perpetuity without
any let or hindrance from the Lessors or any of
them or the Developer or any persons claiming
through, under or in trust for any of the
Lessors/Developer.
(g)
(h)
(i) that the rights of the Lessee shall also
extend to the use and exploitation of the earth,
subsoil, minerals, trees, plants and all else in or on
the Schedule Property and the right to construct
and own such buildings and structures and make
such other improvements thereon at its own cost as
the Lessee shall think fit (not exceeding, however,
an aggregate super built up area of 10,56,000 sq.
ft. on the entire Schedule Property and Future
Development Area, which can be utilized by the
Lessee at any time), all of which buildings,
structures and improvements shall belong
absolutely to the Lessee, may be sold, mortgaged,
charged, leased or in any other manner transferred
or alienated by the Lessee at its sole discretion and
on such terms as it may think fit, and with respect
to which buildings, structures and Improvements or
any transfer or alienation thereof, neither the
Lessors nor the Developer nor any others claiming
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under through or in trust for any of the
Lessors/Developer, will have or make or assert or
permit to be made or asserted, any rights, interest,
claims or demands whatsoever.
(j)
(k) that in view of the permanent perpetual
nature of the lease granted hereby and the sole
right and option of the Lessee to purchase all
balance residuary or reversionary rights in or to the
Schedule Property so as to acquire full and
absolute title and ownership to the Schedule
Property and every portion thereof, the
Lessors/Developer shall not be entitled to sell,
mortgage, lease or otherwise alienate in any
manner, their ownership or any other rights over
the Schedule Property or any part or portion thereof
to any others whomsoever, or attempt or negotiate
to do so;
(l)
(m)
(n)
(o)
(p)
(q)
(r)
8.
9. Notwithstanding anything contained in this
Deed of Permanent Lease or in any other contract
or agreement or arrangement entered into by the
Lessors and/or the Developer, whether amongst
themselves or with any others whomsoever, it is
irrevocably agreed by the Lessors and the
Developer, that the Lessee shall have the right and
option, without obligation to pay any other or further
amounts whatsoever (save and except only for
adjustment of the Security Deposit in full and final
settlement towards the balance price as provided in
Clause 3 above and payment by the Lessee of the
stamp duty and registration charges and all related
expenses as applicable on all required deeds and
documents), to get transferred to itself all the
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COMAP No. 483 of 2025
residuary and/or reversionary rights in respect of
the Schedule Property, so as to obtain the full and
absolute title and all rights to and in respect of the
Schedule Property and every part or portion
thereof, through appropriate sale agreements and
sale deeds / conveyances duly executed and
registered by the Lessors and Developer in favour
of the Lessee. Such right and option of the Lessee
to acquire absolute ownership title and rights to the
Schedule Property may be exercised, in its sole
discretion, at any time after the earliest of:
a. completion of the DivyaSree Technopark project
by the Developer; or
b. transfer by the Lessee, at the cost of the
Developer, after obtaining all required consents and
approvals, of its rights with respect to the excess
FSI/FAR (beyond 10,56,000 sq. ft.) in respect of the
Schedule Property and Future Development Area
to the Lessors/Developer and/or to their
nominee(s); or
c. 12 (Twelve) years from the date of this Deed of
Permanent Perpetual Lease.
It is also agreed by the parties hereto that
notwithstanding anything stated anywhere the
Lessors/Developer shall not be entitled to transfer
ownership in respect of the Schedule Property to
any person other than the Lessee for any reason
whatsoever.
10. At any time after the happening of any of the
events mentioned in Clause 9 above, the Lessee
shall be entitled to call upon the Lessors/Developer
to transfer all the residuary and/or reversionary
rights and interest in respect of the Schedule
Property to the Lessee or its nominee/s and the
Lessors/Developer shall, forthwith upon being so
called upon and in any event within one month
thereof, at the cost and expense of the Lessee,
execute and register the appropriate deeds of sale
or conveyance as may in the opinion of the Lessee
be necessary, so as to vest in the Lessee the full
and absolute ownership and all rights and title to
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the Schedule Property. The stamp duty and
registration charges and all related expenses in
respect of the said deeds of sale or conveyance
shall be borne by the Lessee.
11. The lease of the Schedule Property hereunder
is permanent and perpetual with full and complete
heritable and alienable rights on the part of the
Lessee and such lease shall not accordingly be
terminable on any account by the Lessors or the
Developer or any others claiming through, under or
in trust for any of the Lessors/Developer.
12. The parties hereto acknowledge that the
covenants of the Lessee in Clause 6(a) and (b) of
this Deed of Perpetual Lease are essential terms,
violation whereof, will cause loss and damage to
the Lessors/Developer. It is accordingly agreed,
that in the event of any violation by the Lessee of
the said provisions, the Lessors/Developer shall be
entitled for liquidated damages from the Lessee as
may be mutually agreed upon in due course.”
63. Huawei argues that by virtue of the non obstante provision in
Clause 9 of the PPL, it overrides all other clauses of the PPL . Thus,
notwithstanding anything contained in the PPL, Clause 9 of the PPL
must be enforced on its own terms. It argues that in terms of
Clause 9 of the PPL, it is entitled to absolute ownership of the
schedule ‘A’ property along with all attendant rights, including the
right to carry on further construction on the basis of the FAR/FSI as
applicable to the “Schedule ‘A’ Property” on a standalone basis.
64. Sri G.L. Vishwanath, the learned Senior Counsel appearing
for Huawei also referred to the decisions in the cases of Union of
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COMAP No. 483 of 2025
3
India and another vs. G.M Kokil and others and Chandavarkar
4
Sita Ratna Rao vs. Ashalata S. Guram for explaining the effect of
a non obstante provision. Additionally, learned Senior Counsel
referred to decisions supporting the contention that a textual
interpretation of Clause 9 should be adopted. According to him, the
language of Clause 9 of the PPL is unambiguous, and it should be
construed in accordance with its ordinary meaning. He submitted
that in terms of Clause 10, Huawei was entitled to call upon the
Lessor/Developer to transfer all residuary and/or reversionary rights
in respect of the “Schedule ‘A’ Property”. According to him, this
would denude the Developer of any right whatsoever in respect of
the “Schedule ‘A’ Property”, including the right to raise any
construction on the adjoining lands that could be raised on the basis
of FAR/FSI as applicable to the “Schedule ‘A’ Property” on a
standalone basis.
65. It is a well-settled principle of the interpretation of deeds that a
deed must be understood in reference to the context in which it is
3
1984 (Supp) SCC 196
4
(1986) 4 SCC 447
- 48 -
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executed. In Westminster City Council vs. National Asylum
5
Support Service , Lord Steyn observed as follows:
“5. … The starting point is that language in all
legal texts conveys meaning according to the
circumstances in which it was used. It follows that
the context must always be identified and
considered before the process of construction or
during it. It is, therefore, wrong to say that the court
may only resort to evidence of the contextual scene
when an ambiguity has arisen.”
66. The importance of referring to the context was also
highlighted by the Supreme Court in Reserve Bank of India vs.
6
Peerless General Finance and Investment Co. Ltd. and others .
In this decision, the Supreme Court had explained, albeit in the
context of interpretation of statutes, that the best results of
interpretation are obtained by matching the textual interpretation
with the contextual one. It is apposite to refer to the following
extract from the said decision:
“33. Interpretation must depend on the text and
the context. They are the bases of interpretation.
One may well say if the text is the texture, context
is what gives the colour. Neither can be ignored.
Both are important. That interpretation is best
which makes the textual interpretation match the
contextual. A statute is best interpreted when we
know why it was enacted. With this knowledge, the
statute must be read, first as a whole and then
5
(2002) 4 All ER 654 (HL)
6
1987 (1) SCC 424
- 49 -
COMAP No. 483 of 2025
section by section, clause by clause, phrase by
phrase and word by word. If a statute is looked at,
in the context of its enactment, with the glasses of
the statute-maker, provided by such context, its
scheme, the sections, clauses, phrases and words
may take colour and appear different than when
the statute is looked at without the glasses
provided by the context. With these glasses we
must look at the Act as a whole and discover what
each section, each clause, each phrase and each
word is meant and designed to say as to fit into
the scheme of the entire Act. No part of a statute
and no word of a statute can be construed in
isolation. Statutes have to be construed so that
every word has a place and everything is in its
place.”
67. Although Chinnappa Reddy J had made the above
observations in the context of interpretation of statutes, the principle
enunciated would be equally applicable when interpreting an
agreement.
68. It would not be apposite to interpret any clause of the PPL in
complete disregard of the context of the commercial understanding
reflected in the other clauses of the PPL. The context in which the
parties came to execute the PPL is equally important in interpreting
its terms.
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COMAP No. 483 of 2025
69. In Provash Chandra Dalui and another vs. Biswanath
7
Banerjee and another the Supreme Court underscored the
importance of interpreting a contract as a whole with reference to its
object and had observed as under :
10. ‘Ex praecedentibus et consequentibus optima fit
interpretatio.’ The best interpretation is made from
the context. Every contract is to be construed with
reference to its object and the whole of its terms .
The whole context must be considered to ascertain
the intention of the parties . It is an accepted
principle of construction that the sense and
meaning of the parties in any particular part of
instrument may be collected ‘ex antecedentibus et
consequentibus;’ every part of it may be brought
into action in order to collect from the whole one
uniform and consistent sense, if that is possible .”
70. In Bihar State Electricity Board, Patna and others vs. M/s.
8
Green Rubber Industries and others , the Supreme Court
reiterated the said principle as under:
“23. … Every contract is to be considered with
reference to its object and the whole of its terms
and accordingly the whole context must be
considered in endeavouring to collect the intention
of the parties, even though the immediate object of
enquiry is the meaning of an isolated clause.”
71. In Union of India vs. G.M.Kokil and others ( supra ) which
was referred to on behalf of Huawei, the Supreme Court had
explained the meaning of non obstante clause as under:
7
1989 SCC (SUPP) 1 487
8
(1990) 1 SCC 731
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COMAP No. 483 of 2025
"11. It is well known that a non obstante clause is
legislative device which is usually employed to give
overriding effect to certain provisions over some
contrary provisions that may be found either in the
same enactment or some other enactment, that is
to say, to avoid the operation and effect of all
contrary provisions."
72. There is no cavil as to the meaning of the non obstante
provision. It is well understood that the same is used to give
overriding effect to the provision over any contrary or inconsistent
provisions in the statute or a deed. Having said that, it is also
necessary to bear in mind that the non obstante clause cannot be
read to mean that it has to be read on a standalone basis in
complete disregard of the other provisions of either the statute or an
agreement. It is important to ascertain the extent to which the non
obstante clause is to be applied to override the other clauses of an
agreement or the provisions of a statute, as the case may be. In
this regard, it is necessary to bear in mind the principle that a non
obstante clause must be applied to override other provisions only to
the extent it is necessary. In other words, it must be first ascertained
that whether there is any inconsistency in the language of the
provisions, which cannot be reconciled. If it is found that giving
effect to one provision would necessarily be destructive of the other
provision, the non obstante clause will be pressed into service.
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COMAP No. 483 of 2025
However, if it is found that the provisions of a statute or the clauses
of an agreement can be harmoniously construed, it would be
unnecessary and inapposite to construe a provision or clause as
overriding the other provisions/clauses.
73. In A.G Varadarajulu and another vs. State of Tamil Nadu
9
and others , the Supreme Court had observed as under:
“16. It is well settled that while dealing with a non
obstante clause under which the legislature wants
to give overriding effect to a section, the court must
try to find out the extent to which the legislature had
intended to give one provision overriding effect over
another provision.”
10
74. In Central Bank of India vs. State of Kerala and others ,
the Supreme Court had set out the said principle in the following
words:
"103. A non obstante clause is generally
incorporated in a statute to give overriding effect to
a particular section or the statute as a whole. While
interpreting non obstante clause, the court is
required to find out the extent to which the
legislature intended to do so and the context in
which the non obstante clause is used. This rule of
interpretation has been applied in several
decisions."
9
(1998) 4 SCC 231
10
(2009) 4 SCC 94
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COMAP No. 483 of 2025
75. It is also well settled that a contract must be read as a whole.
It would be inapposite to examine any clause of the contract in
isolation of the other terms.
76. In Investors Compensation Scheme Ltd. vs. West
11
Bromwich Building Society , Lord Hoffmann, while speaking for
the majority, had summarised the principles for interpretation of
contracts as under:
“( 1 ) Interpretation is the ascertainment of the
meaning which the document would convey to a
reasonable person having all the background
knowledge which would reasonably have been
available to the parties in the situation in which they
were at the time of the contract.
( 2 ) The background was famously referred to by
Lord Wilberforce as the “matrix of fact”, but this
phrase is, if anything, an understated description of
what the background may include. Subject to the
requirement that it should have been reasonably
available to the parties and to the exception to be
mentioned next, it includes absolutely anything
which would have affected the way in which the
language of the document would have been
understood by a reasonable man.
( 3 ) The law excludes from the admissible
background the previous negotiations of the parties
and their declarations of subjective intent. They are
admissible only in an action for rectification. The
law makes this distinction for reasons of practical
policy and, in this respect only, legal interpretation
differs from the way we would interpret utterances
in ordinary life. The boundaries of this exception
11
(1998) 1 WLR 896
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COMAP No. 483 of 2025
are in some respects unclear. But this is not the
occasion on which to explore them.
( 4 ) The meaning which a document (or any other
utterance) would convey to a reasonable man is not
the same thing as the meaning of its words. The
meaning of words is a matter of dictionaries and
grammars; the meaning of the document is what
the parties using those words against the relevant
background would reasonably have been
understood to mean. The background may not
merely enable the reasonable man to choose
between the possible meanings of words which are
ambiguous but even (as occasionally happens in
ordinary life) to conclude that the parties must, for
whatever reason, have used the wrong words or
syntax: see Mannai Investments Co. Ltd. v. Eagle
Star Life Assurance Co. Ltd. [ Mannai Investments
Co. Ltd. v. Eagle Star Life Assurance Co. Ltd. ,
1997 AC 749 : (1997) 2 WLR 945 (HL)]
( 5 ) The “rule” that words should be given their
“natural and ordinary meaning” reflects the
common sense proposition that we do not easily
accept that people have made linguistic mistakes,
particularly in formal documents. On the other
hand, if one would nevertheless conclude from the
background that something must have gone wrong
with the language, the law does not require Judges
to attribute to the parties an intention which they
plainly could not have had.”
77. The aforesaid principles were also noted by the Supreme
Court in Nabha Power Limited (NPL) v. Punjab State Power
12
Corporation Limited (PSPCL) and another .
12
(2018) 11 SCC 508
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COMAP No. 483 of 2025
78. We also consider it apposite to refer to the following
observation of the Supreme Court in DLF Universal Ltd. and
Another v. Director, Town & Country Planning Department,
13
Haryana and Others .
“13. It is a settled principle in law that a contract is
interpreted according to its purpose. The purpose
of a contract is the interests, objectives, values,
policy that the contract is designed to actualise. It
comprises the joint intent of the parties. Every such
contract expresses the autonomy of the contractual
parties' private will. It creates reasonable, legally
protected expectations between the parties and
reliance on its results. Consistent with the character
of purposive interpretation, the court is required to
determine the ultimate purpose of a contract
primarily by the joint intent of the parties at the time
the contract so formed. It is not the intent of a
single party; it is the joint intent of both the parties
and the joint intent of the parties is to be discovered
from the entirety of the contract and the
circumstances surrounding its formation.”
79. In Naramadaben Maganlal Thakker vs. Pranjivandas
14
Maganlal Thakker and others , the Supreme Court reiterated the
requirement for reading a document harmoniously as under:
“3. It is now well-settled legal position that a
document has to be read harmoniously as a whole
giving effect to all the clauses contained in the
document which manifest the intention of the
persons who execute the document.”
13
(2010) 14 SCC 1
14
(1997) 2 SCC 255
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80. Bearing the aforesaid principles in mind, we may now
ascertain the commercial understanding between the parties. As
noted earlier, Huawei and the Developer engaged in negotiations
and discussions in the context of Huawei's requirement to develop a
campus on 20 acres of land. Huawei expressed its interest in
developing 10,56,000 sq. ft. of super built-up area for its campus on
20 acres of land. It was understood by Huawei and the Developer
that the said campus would be a part of the DivyaSree Technopark,
an integrated complex on the larger property. The integrated
DivyaSree Technopark is being developed as a mixed development,
comprising residential units, commercial buildings, recreational
areas, open areas, amongst others. DivyaSree Technopark was not
contemplated as comprising isolated pockets but as an integrated
complex.
81. The LOI dated 31.05.2005 had expressly set out that Huawei
was interested in "the development of about 10,56,000 sq. ft. of
super built up area.... in an extent of about 20 (Twenty) acres of
land .... forming part of your project DivyaSree Technopark" .
Huawei now seeks to separate its campus from DivyaSree
Technopark, inasmuch as it seeks absolute rights over the land,
including the right to raise additional construction unconnected with
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the other developments of DivyaSree Technopark, with a separate
khata.
82. The LOI also expressly recorded the Developer's
representation that it was in a position to arrange the construction of
10,56,000 sq. ft. of super built-up area required for Huawei's
campus, and that it was entitled to utilise the remaining FAR/FSI in
the adjoining lands of DivyaSree Technopark. Paragraph 5 of the
LOI expressly records that in order to achieve the same, the lands
would be demised to Huawei by way of PPL with full and exclusive
occupation and enjoyment rights. The LOI also recorded that the
lease would specifically provide for option to acquire the said land
on completion of the DivyaSree Technopark Project, or 12 years
from the date of the LOI, or in the event that Transfer of the
Development Rights (TDR) has been made available by the
concerned Government Authority and Huawei has transferred its
rights with respect to the excess FAR/FSI to the Developer,
whichever is the earliest.
83. The LOI also includes negative covenants to the effect that,
under no circumstances, construction would be raised on the
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“Schedule ‘A’ Property” other than 10,56,000 sq. ft., as proposed by
Huawei for its campus.
84. It is important to note that the LOI also specifically provided
that any permissible super built up area over and above 10,56,000
sq. ft. in the said lands would be available to the Developer only for
use in the adjoining areas of DivyaSree Technopark. It was not
open for the Developer to freely deal with the additional
development rights over and above 10,56,000 sq. ft. of super built
up area; the excess permissible area could only be used for
development within the DivyaSree Technopark.
85. The commercial understanding between the parties is also
evident from the fact that although the extent of the land over which
Huawei’s campus was to be built under the LOI was subsequently
reduced, the essential element of the understanding that Huawei
would be entitled to construct 10,56,000 sq. ft. of super built-up area
remained operative. This was the cornerstone of the commercial
understanding between Huawei and the Developer.
86. Huawei had also expressed its intention to raise construction
in two phases. Phase I would comprise 6 lakhs sq. ft of super built-
up area, and Phase II would comprise 3 lakhs sq. ft. of area.
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Huawei could take up construction of the remaining 1,56,000 sq. ft.
subsequently at its discretion.
87. It is not disputed that as per the understanding between the
parties, even if 10,56,000 sq. ft. of super built up area exceeded the
extent of construction permissible on the basis of the applicable
FAR/FSI, Huawei was assured that it would be entitled to raise
construction to the extent of 10,56,000 sq. ft. if necessary, by
drawing from the other areas of DivyaSree Technopark.
88. Huawei’s campus, being a part of an Integrated Complex - the
DivyaSree Technopark, was an integral part of the approved
development plan of the larger property. The Developer examined
its Chief Architect (DW2), who was involved in drawing up the
development plans (exhibited as Exs. P7, 8 and 9). He had
deposed that the re-modified development plan (Ex.P9) of the
DivyaSree Technopark covered an area of 67 acres 12 guntas,
which comprises the land owned by the Developer (4.875 acres) as
well as the lands owned by the Landowners who had entered into
the Joint Development Agreements with the Developer (60.950
acres) and 1.475 acres of private properties of the Landowners
(appellants No.1 to 9) brought into the Development Plan. He
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affirmed that the “Schedule ‘A’ Property”, which was leased under
the PPL, was allocated from the Developer’s share of the project.
He also deposed that building plans could be approved by BBMP
within the parameters of the approved development plan and BBMP
was required to adhere to the development plan to determine the
extent of FAR/FSI available for any particular block. We consider it
apposite to refer to the following extract from his affidavit:
"5. I submit that the Development Plan has
undergone several changes over the years in order
to accommodate the permissible FAR/FSI which
was available for allocation and utilization under the
Development Plan at the relevant time. Exhibits P7
— P9 show the changes that the Development Plan
underwent. The relevant Development Plan is the
Remodified Development Plan. The Remodified
Development Plan comprises of IT/ITES SEZ
buildings, commercial IT/BT buildings (non SEZ)
and large-scale residential buildings in various
blocks that are spread across the entire extent of
land with areas demarcated for parks, open
spaces, civic amenities, driveways, and
CDP/Master Plan roads. The Remodified
Development Plan comprises of blocks A1-A8, A9 -
Multi-Level Car Park (MLCP) and Service
Apartments, B4-B5, Cl and C3, blocks H1-H5 and
residential ancillary blocks R1-R4. The available
FAR/FSI has been distributed across all these
blocks which are proposed for development. In
other words, each block has been allocated a
specific FAR/FSI and construction is to be carried
out to that extent in each of the allocated blocks.
Once the Development Plan is approved by the
BDA, the sanction for putting up construction,
namely the building plans, are obtained by the
Defendant No.17 from the Bruhat Bengaluru
Mahanagara Palike (“BBMP”) and the said sanction
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is accorded only within the parameters already
approved in the Development Plan.
6. I submit that while evaluating a development
plan, the BDA is required to examine the same
from the context of the Zonal Regulations. The BDA
is required to ensure that the parks/civic amenities
are in line with the Zonal Regulations and planning
norms. In addition, the CDP/Master Plan provides
for various roads and open spaces which the
development plan must also comply with. In
addition, it is essential that the Development Plan
provides for the type (commercial/residential/hotel
etc), and format (number of floor) of the buildings
that are to come up in the areas designated for
development. The shape of the building has to be
earmarked which has a direct bearing on ground
coverage. Similarly, the height of the building
determines the setback for the complete
development plan and distances in between. I
submit that once the type, format, shape and height
of the building are approved as part of the
development plan, no change is allowed by building
approving entities such as the BBMP. In addition,
the BDA checks and approves the cumulative flour
area ratio and built-up areas to determine the total
construction that is permissible in that entire area.
Car parking, ground coverage for the development
are checked, verified and approved.
7. While giving building plan approval, the
BBMP is required to examine and adhere to the
Development Plan to determine the extent of
FAR/FSI available in the Development Plan for any
particular block, and then alone can the BBMP
approve the building plan to the extent provided for
in the Development Plan. The BBMP does not
approve any deviation from the Development Plan.
I state that the BDA approved Development Plan is
a very important document as once it is approved,
the same becomes the blueprint and directive for all
construction to be carried out at the project site. I
state that without the BDA approved Development
Plan, the BBMP will not accept any application
process for further approval for plan sanctions and
commencement certificates, or any other
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application process relating to construction at the
project site. I state that once approved, the
Development Plan has no validity period/expiry
date.
8. I submit that as there existed CDP roads in
the Comprehensive Development Plan of the BDA,
a certain extent measuring 2 acre 31 guntas, was
relinquished in favor of the BDA free of cost. I
further submit that in the southern portion of the
Remodified Development Plan in an extent
approximately measuring 11 acre 31.5 guntas, a
residential development was carried out and in
respect of which certain extent of land had to be
relinquished in favor of the BDA towards civic
amenities, parks and open spaces. I submit that
this issue is relevant because the area demarcated
as - residential is part of the Remodified
Development Plan and it is out of the area allocated
towards residential that the land is relinquished. In
other words, the overall structure of the Remodified
Development Plan cannot be altered in view of
various obligations that are undertaken in the
Remodified Development Plan."
89. DW2, in his cross-examination, candidly stated that he had
not participated in the negotiations and had not gone through the
agreements, including the PPL, in detail. He clarified that he was
only concerned with the technical aspects of the area allocations.
He was confronted with certain photographs of areas of the
DivyaSree Technopark and he admitted that certain areas were
vacant.
90. The learned Commercial Court concluded that the FAR/ FSI
applicable to the “Schedule ‘A’ Property” had not been utilised by
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COMAP No. 483 of 2025
raising construction on the adjoining land forming part of the
DivyaSree Technopark. However, we do not find this to be of much
relevance in interpreting the terms of the PPL. It is important to note
that DW2 had also clearly stated that the FAR/ FSI achieved under
the remodified development plan (Ex.P9) was 2.45. Paragraph 10 of
his affidavit reads as under:
"I submit that the Remodified Development
Plan has achieved a total FAR/FSI of 2.45 out of a
permissible 2.5. In other words, out of a total
permissible FSI/FAR of 6,06,814.75 square meters,
an extent of 5,94,872.55 square meters of FSI/FAR
has been allocated and consumed and a balance
FSI/FAR of 11,942.20 square meters is available in
the overall larger developable land of 67 acres 12
guntas. The Plaintiff is entitled in terms of the PPL
to a further extent of 5,218 square meters of
FAR/FSI, which is 56,166.55 sq. ft. (69,056.34 -
63,838.34 square meters / 7,43,322.44 -
6,87,155.89 sq. ft.), The balance built-up area that
the Plaintiff is entitled to amounts to 7,412.94
square meters, which is 79,793 sq. ft. (98,104.79 -
90,691.85 square meters / 10,56,000 - 9,76,207
Sq. ft.). This balance extent is reserved in the
Remodified Development Plan for the Plaintiff to
exploit if it so chooses out of the Defendant No.17's
share of FAR/FSI under the Joint Development
Agreements."
91. It is clear from the above that Huawei's campus is a part of
the remodified development plan. It is also not seriously disputed
that the construction plans must conform to the remodified
development plan of the larger property.
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COMAP No. 483 of 2025
92. All the agreements entered into between the parties, including
the PPL, are based on the fundamental premise that the “Schedule
‘A’ Property” would be a part of the DivyaSree Technopark and that
Huawei’s campus was never considered as a standalone campus
outside the Integrated Complex. Huawei's interest, in all
agreements including the PPL, was expressly confined to
developing 10,56,000 sq. ft built up area on its campus.
93. In this context, we may examine the relevant clauses of the
PPL. Clause 6(a) of the PPL expressly provides that Huawei can
construct and erect on its own, "not more than an aggregate super
built-up area of 10,56,000 sq. ft." on the “Schedule ‘A’ Property” and
the Future Development Area. It also expressly provides that the
Lessors/Developer can utilise the balance FAR/ FSI available in
respect of the “Schedule ‘A’ Property” over and above 10,56,000 sq.
ft. and to build on such adjoining properties corresponding super
built up area over 10,56,000 sq. ft which may be “ now permissible,
or made available in the future ”. Huawei was expressly assured
that there would be no reduction in Huawei's right and entitlement to
construct 10,56,000 sq. ft. of built-up space even if it did not get the
rights in respect of the Future Development Area. Thus, Huawei’s
right to build to the extent of 10,56,000 sq ft was sacrosanct and
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COMAP No. 483 of 2025
would remain unaffected by the reduction in the available land.
Huawei also agreed to execute such documents as may be required
to comply with the requirement for the transfer of
lessors’/developer's right in regard to FAR/FSI in excess of
10,56,000 sq. ft.
94. Clause 7 of the PPL, inter alia , set out that the rights of
Huawei would extend to the use and exploitation of the earth,
subsoil, minerals, trees, plants and all else in or on the “Schedule ‘A’
Property” and make such other improvements thereon on its own
cost. However, the aggregate super built up area would not exceed
10,56,000 sq. ft.
95. Clause 12 of the PPL also expressly recorded that the
covenants of the Lessee in Clause 6(a) and (b) " are essential terms,
violation whereof, will cause loss and damage to the
Lessors/Developer ” and that in the event of any violation, the
Lessors/Developer shall be entitled for liquidated damages from the
Lessee as may be mutually agreed upon in due course.
96. Clause 9 of the PPL must be considered in the light of the
other clauses mentioned above and in particular, clauses 6, 7 and
12 of the PPL.
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COMAP No. 483 of 2025
97. Clause 10 of the PPL entitles Huawei, at any time after the
happening of any of the events mentioned in Clause 9, to call upon
the Lessors/Developer to transfer all the residuary and/or
reversionary rights and interest in the “Schedule ‘A’ Property” so as
to vest in it the full and absolute ownership thereof. The events
specified in Clause 9 are:
(a) completion of the DivyaSree Technopark project by
the Developer; or
(b) transfer by Huawei of its rights in respect of the
excess FAR/FSI (beyond 10,56,000 sq.ft.) to the
Lessors/Developer; or
(c) expiry of twelve years from the date of the PPL.
98. There is no cavil that Huawei would be entitled to obtain the
absolute rights on a free hold basis of the “Schedule ‘A’ Property”.
As noted hereinbefore, the issue is only whether the clauses, which
confined the development to be raised on the “Schedule ‘A’
Property” to 10,56,000 sq. ft of super built-up area, would cease to
be operative.
99. We may at this stage note that no agreement or
contemporaneous communication was brought to our notice which
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COMAP No. 483 of 2025
would record an understanding that the restriction to build not more
than 10,56,000 sq. ft would cease to be operative on transfer of the
freehold rights over the “Schedule ‘A’ Property” in favour of Huawei.
Huawei rests its case solely on Clause 9 of the PPL. As noted
above, a similar provision is also contained in the LOI. However,
Clause 9 of the PPL does not expressly provide that the restrictions
on raising construction beyond 10,56,000 sq. ft. would cease to be
operative. Huawei's case rests on the interpretation of the words
residuary or reversionary rights as used in Clause 9, which,
according to it, would also obliterate the restriction confining
construction on the “Schedule ‘A’ Property” to 10,56,000 sq. ft.
100. Huawei relied on the dictionary meaning of the said
expression to canvass that the Developer or the Landowners would
be left with no right whatsoever, including rights flowing from the
restriction on raising construction beyond 10,56,000 sq ft on the
“Schedule ‘A’ Property” being conveyed to Huawei. We are not
persuaded to accept the said contention mainly for the reason that
such an interpretation runs contrary to the commercial
understanding as is reflected under various other clauses of the
PPL and prior agreements.
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COMAP No. 483 of 2025
101. The contention that the non obstante provision of Clause 9
would compel us to read the expression “reversionary” or “residuary
rights” in an expansive manner is equally unpersuasive. The non
obstante provision applies only if we find a clear conflict between
the terms of Clause 9 and other terms of the PPL that cannot be
reconciled. However, a harmonious construction of the clauses
indicates that there is no conflict between Clause 9 and the other
clauses of the PPL. Under the PPL, Huawei had the leasehold
rights, and the residuary rights were vested with the Landowners or
the Developer. The import of Clause 9 is that such residuary rights
would also vest with Huawei on the “Schedule ‘A’ Property” being
conveyed to it. The words residuary and reversionary rights, in our
view, are required to be read to mean, all rights that remain with the
Developer or Landowners in respect of the “Schedule ‘A’ Property”.
However, the contractual agreement that the construction on the
“Schedule ‘A’ Property” would not exceed 10,56,000 sq. ft. of super
built up area would continue to be operative.
102. The agreement that Huawei would not raise construction
beyond 10,56,000 sq. ft. is embodied in several clauses of the PPL,
the LOI and some other agreements. The said covenant is
repeated many times. However, there is no clause which expressly
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COMAP No. 483 of 2025
provides that on the residuary rights or the reversionary rights being
conveyed to Huawei, the said restriction would no longer be
operative.
103. Considering the detailed documentation and reiterations in
the agreements that Huawei will confine the construction to
10,56,000 sq. ft. of super built up area; it is apparent that if the
parties intended the restriction to be inoperative on the conveyance
of the “Schedule ‘A’ Property”, they would have expressly stated so
in the PPL.
104. There has been some debate as to whether the Developer
has fully utilised the FAR/FSI applicable to the “Schedule ‘A’
Property”. As noted above, DW2 unambiguously stated that the
remodified development plan had achieved a total FAR/FSI of 2.45
out of a permissible 2.5. In other words, he affirmed in the affidavit
that, out of the total permissible FAR/FSI of 6,06,814.75 sq. mts., an
extent of 5,94,872.55 sq. mts. of FAR/FSI had been allocated and
consumed. The balance 11,942.20 sq. mts. was available in the
overall larger developable land. It is stated that Huawei had raised a
construction of 9,76,207 sq. ft. as against an upper limit of
10,56,000 sq. ft. of super built up area. Thus, the balance built up
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COMAP No. 483 of 2025
area available was 79,793 sq. ft. Thus, it was permissible for
Huawei to further raise 79,793 sq. ft. (which translates to 7,412.94
sq. mt.) super built up area. Thus, there would be no additional
FAR/FSI available for further construction on the “Schedule ‘A’
Property”. However, according to Huawei, it is entitled to the full
extent of FAR/FSI as applicable to the “Schedule ‘A’ Property”,
without any restriction limiting the construction to only 10,56,000 sq.
ft. of built up area. Huawei's contention is also premised on the
basis that such FAR/FSI would be available, as it is not consumed.
105. The logical sequitur of this argument is that if the Developer
had raised construction on the adjoining lands of the DivyaSree
Technopark by using the FAR/FSI as applicable to the “Schedule ‘A’
Property” to the extent of over and above 10,56,000 sq. ft. of super
built-up area – as it was entitled to do under the PPL – the
Developer would have to demolish the same to restore the full
FAR/FSI on the “Schedule ‘A’ Property”. Plainly, this was not the
agreement between the parties. Huawei also claims that under the
PPL, the Developer is obliged to restore the full FAR/FSI of the
“Schedule ‘A’ Property” by ensuring that the construction raised on
the adjoining lands is confined to as permissible on the basis of the
FAR/FSI as applied to the extent of those lands.
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106. Concededly, if the Developer had secured the sanction of
plans to raise construction on the lands, other than the “Schedule ‘A’
Property”, forming a part of the larger property by loading the
FAR/FSI of the “Schedule ‘A’ Property” over and above 10,56,000
Sq ft – as claimed by it – Huawei could have no claim over it.
Clearly, it could never be the understanding between the parties
that, on the “Schedule ‘A’ Property” being conveyed to Huawei, the
Developer would have to make good the FAR/FSI in respect of the
“Schedule ‘A’ Property” that it had already utilised in construction. It
follows that Huawei's case for the right to construct beyond
10,56,000 sq. ft. is contingent on whether the Developer had utilised
the same by securing the necessary approvals. However, neither
the PPL nor any other agreement expressly records any such
understanding.
107. A plain and harmonious reading of the PPL compels us to
hold that Huawei would be bound by the restriction not to construct
beyond 10,56,000 sq. ft. of super built up area on the “Schedule ‘A’
Property”.
108. In view of the above, the impugned judgment and decree are
modified. The appellants No.1 to 16, acting through the Developer,
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and the Developer are directed to execute and register a sale deed
in favour of Huawei in respect of the “Schedule ‘A’ Property”, as
specified in the PPL, subject to a condition that Huawei shall not be
entitled to raise construction beyond 10,56,000 sq. ft. of super built-
up area on the said property. Huawei shall also be entitled to have
its ownership right over the “Schedule ‘A’ Property” recorded in the
land records. The other prayers as sought for by Huawei stand
rejected.
109. The modified decree shall be prepared according to the
aforesaid terms.
110. Accordingly, the appeal is allowed.
111. In view of the disposal of the appeal, the pending interlocutory
application stands disposed of.
Sd/-
(VIBHU BAKHRU)
CHIEF JUSTICE
Sd/-
(C.M. POONACHA)
JUDGE
KMV/AHB/KPS