IMPORTANT POINTS
The ‘State’ acting whether as a ‘landlord’ or a ‘tenant’ is required to act bona fide and not arbitrarily, when the same is likely to affect prejudicially the right of others.
Right of property although is not a fundamental right, nonetheless remains a constitutional right and any expropriatory legislation must be construed strictly.

Headnote:Constitution of India – Article 12 – Appellant-company is a ‘State’ within the meaning of Article 12 of the Constitution of India – It is, therefore, enjoined with a duty to act fairly and reasonably – Just because it has been conferred with a statutory power, the same by itself would not mean that exercise thereof in any manner whatsoever will meet the requirements of law – The “desire” of the Central Government used in the statute must be based on objective criteria – The ‘State’ acting whether as a ‘landlord’ or a ‘tenant’ is required to act bona fide and not arbitrarily, when the same is likely to affect prejudicially the right of others – In view of the concurrent finding of fact of the desire of the appellant not being bona fide, and possession of the lease holding having already been delivered after a long struggle, no interference warranted. (Paras 13, 16, 20, 24, 26 and 30) (2004) 9 SCC 772; (1998) 1 SCC 591; 2006 (9) SCALE 652; (1989) 3 SCC 293; (2006) 10 SCC 236; (2006) 4 SCC 683 – Relied upon. Judicial Interpretation – A judgment must be read in its entirety, it must be construed reasonably and if necessary, in the light of the constitutional and statutory provisions – Only because a statute causes hardship, the same may not be declared ultra vires – A statute must be construed justly, an unjust law is no law at all – Also, when two views are possible, a view which satisfies the constitutional rights or requirements, must be preferred – Right of property although is not a fundamental right, nonetheless remains a constitutional right and any expropriatory legislation must be construed strictly. (Paras 15, 18, 20, 27) 2006 (13) SCALE 511; (2005) 5 SCC 375; (1992) 2 SCC 36; (2005) 7 SCC 627 – Relied upon.
       Facts of the case :
       The Burmah Shell (Acquisition of Undertakings in India) Act, 1976 provides for acquisition and transfer of the title, right and interest in the “Burmah Shell Oil Storage and Distributing Company of India Ltd.” to Bharat Petroleum Corporation Limited. The said Act came into force on 24.01.1976 which was the ‘appointed day’. By reason of Section 3, the right, title and interest of Burmah Shell stood transferred to and vested in the Central Government. As per Section 5 the Central Government shall be deemed to be the lessee or tenant under the circumstances specified therein. Central Government, in exercise of its power conferred upon it under Section 7, directed that the undertaking of the Burmah-shell shall vest in the appellant which is a Government Company Burmah-shell, the predecessor-in-interest of the appellant was a lessee for a period of 30 years by virtue of a deed of lease which was executed on or about 25.07.1959 by the respondent. On expiry of the period of lease on 30.08.1985, the appellant exercised its purported right of renewal by issuing a notice on or about 24.05.1989. Respondents by a letter dated 26.08.1990 stated that as the rent in respect of the said land has not been paid and the provisions of the said Act have no application, the tenancy shall stand terminated with effect from 24.09.1990 and asked the Appellant to vacate and deliver possession of the said premises. As the appellant did not vacate the premises; a suit for eviction was filed. Suit was dismissed by the trial court but allowed by the First Appellate Court. Second Appeal dismissed by High Court. The decree has been executed and the respondent has been put in possession of the decretal premises.
       Findings of the Court :
       In view of the concurrent finding of fact of the desire of the appellant not being bona fide, and possession of the lease holding having already been delivered after a long struggle, no interference warranted.

JUDGMENT

S.B. Sinha, J.—

1.Leave granted.

2.Appellant is a Government company. The Parliament enacted the Burmah Shell (Acquisition of Undertakings in India) Act, 1976 (The said Act), inter alia, to provide for acquisition and transfer of the title, right and interest in the “Burmah Shell Oil Storage and Distributing Company of India Ltd.” to Bharat Petroleum Corporation Limited. The said Act came into force on 24.01.1976 which was the ‘appointed day’ fixed within the meaning of Section 2A(c) of the Act. By reason of Section 3 of the said Act the right, title and interest of Burmah Shell stood transferred to and vested in the Central Government. Section 5 of 1976 Act provides that the Central Government shall be deemed to be the lessee or tenant under the circumstances specified therein. Sub-section (2) of Section 5 which is relevant for our purpose reads thus :

“On the expiry of the terms of any lease or tenancy referred to in sub-section (1) such lease or tenancy shall if so desired by the Central Government be renewed on the same terms and conditions on which the lease or tenancy was held by Burmah-Shell immediately the appointed day.”

3.It is not in dispute that the Central Government in exercise of its power conferred upon it under section 7 of the said Act directed that the undertaking of the Burmah-shell shall vest in the appellant herein which is a Government company; the consequences, inter alia, wherefor is laid down in sub-section (3) thereof which reads as under :

“The provisions of sub-section (2) of section 5 shall apply to a lease or tenancy, which vests in a Government company, as they apply to a lease or tenancy vested in the Central Government and reference therein to the “Central Government” shall be construed as a reference to the Government company.”

4.Burmah-shell, the predecessor-in-interest of the appellant was a lessee for a period of 30 years by virtue of a deed of lease which was executed on or about 25.07.1959 by the respondent. The stipulated rent was Rs.50/- per month. On expiry of the period of lease on 30.08.1985, the appellant exercised its purported right of renewal by issuing a notice on or about 24.05.1989 stating :

“On 1st August, 1977, another fresh certificate of incorporation was issued under the same section of the Companies Act, 1956, effecting the change in the name of the Company from Bharat Refineries Ltd., to Bharat Petroleum Corporation Ltd., which change as before does not affect any rights or obligations of the Company. This is to advise you that in terms of Section 5 and Section 7(3) of the Burmah-Shell (Acquisition of Undertaking in India) Act, 1976, extract of which is enclosed for your reference, we desire to renew the lease for a further period of 30 years commencing from 25.7.1989 on the same terms and conditions on which the lessee abovementioned viz. Burmah-Shell Oil Storage & Distributing Co. of India Ltd., held the lease immediately before the appointed day viz. 24th January, 1976. May we therefore, request you to let us know when it will be convenient for you to have the lease registered on terms similar to those existing in the current lease. On receipt of your advice in this matter, we shall take further action.”

5.Respondents did not agree thereto. They, on the other hand, by a letter dated 26.08.1990 stated that as the rent in respect of the said land has not been paid and the provisions of the said Act have no application, the tenancy shall stand terminated with effect from 24.09.1990. Appellant was called upon to vacate and deliver possession of the said premises stating :

“Please therefore take notice that if you fail to vacate and deliver vacant possession of the said property immediately after 24.09.1990 paying damages for use and occupation at Rs.5,000/- per month and the costs of this notice to my clients, they will be constrained to file a suit against you for appropriate reliefs and that you will also be liable for all my client’s cost.”

6.Despite service of the s

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2007 Supreme(SC) 621

Cases Referred (10)