Licensee cannot claim adverse possession against licensor as permissive possession is not inherently hostile.

The Plaintiff (Respondent No. 1) operated a tea stall on Kolhapur Municipal Corporation (KMC) property since 1984 under a license that expired in 1993 and was never renewed.

Following a demolition by KMC in August 2023, the Plaintiff filed a suit for declaration of title via adverse possession and a permanent injunction.

The Trial Court (Civil Judge, Senior Division, Kolhapur) rejected the Plaintiff’s application for an interim injunction (Exhibit-5) on 30.11.2023.

On appeal, the District Judge-5, Kolhapur, reversed this decision on 03.07.2025, granting protection to the Plaintiff.

The Petitioners (KMC) challenged the appellate order before the High Court.

1. Whether a licensee whose license has expired can claim ownership of municipal property through adverse possession.

2. Whether the First Appellate Court exceeded its jurisdiction by substituting its discretion for that of the Trial Court in an interlocutory matter.

3. Whether the mandatory notice requirements under Section 81(B) of the Maharashtra Municipal Corporations Act, 1949, apply to unauthorized occupants.

The Court applied the principle that permissive possession cannot transition into adverse possession without an explicit "hostile intent" (animus) communicated to the owner, as established in A. Shanmugam v. Ariya Kshatriya Rajakula Vamsathu Madalaya Nandhavana Paripalanai Sangam (2012).

Regarding appellate jurisdiction, it relied on Wander Limited v. Antox India P. Ltd. (1990), which mandates that an appellate court must not interfere with a lower court's discretionary order unless it is arbitrary, capricious, or perverse.

The court also interpreted Section 81(B) of the Maharashtra Municipal Corporations Act, 1949, noting that statutory protections are reserved for authorized occupants.

The High Court found the Plaintiff's claim of adverse possession meritless because his entry was initially permissive under a license; a licensee cannot claim adverse title against the licensor merely due to non-regularization of the license.

The Court observed that the First Appellate Court erred by failing to recognize that the Plaintiff was an unauthorized occupant and that the demolition occurred on 10.08.2023, before the suit was even filed on 18.08.2023, making the matter facto accompli at the time of filing.

Furthermore, the Trial Court’s refusal to grant an injunction was a "reasonably possible" view based on the material; therefore, the Appellate Court committed a jurisdictional error by substituting its own findings without proving the Trial Court’s order was perverse.

The High Court allowed the Writ Petition and quashed the order of the District Judge-5, Kolhapur; the Trial Court's order dated 30.11.2023, which rejected the interim injunction, was restored and the request to stay this judgment was rejected.