2016 Supreme(SC) 286

SUPREME COURT OF INDIA
V. GOPALA GOWDA, ARUN MISHRA, JJ.
Delhi Development Authority – Appellant
Versus
M/s Anant Raj Agencies Pvt. Ltd. – RESPONDENT
Civil Appeal No. 3783 of 2016 (Arising out of S.L.P. (C) NO.6978 of 2012)
Decided on : 12-04-2016

IMPORTANT POINT
There cannot be an automatic renewal of lease in favour of the original lessee once it stands terminated by efflux of time and also by issuing notice terminating the lease.
Transfer of Property Act, 1882 is not applicable in respect of the public premises.
If renewal of lease is refused by DDA the lessee becomes unauthorised occupant.
Unauthorised occupants are liable pay damages to DDA.

Headnote:(a) Delhi Development Act, 1957 – Sections 21(1) and 22 r/w Rule 43, Delhi Development Authority (Disposal of Developed Nazul Land) Rules, 1981 – Clause III(b), Lease deed – Renewal of lease – DDA terminating lease – Respondent no. 1 not vacating – Depositing rent in office of DDA – There cannot be an automatic renewal of lease in favour of the original lessee once it stands terminated by efflux of time and also by issuing notice terminating the lease – Merely accepting the amount towards the rent by office of DDA after expiry of lease period – Of no significance. (Para 24, 25, 27)

       (2005) 5 SCC 543; (1990) 4 SCC 406 – Relied upon

       (b) Interpretation of statute – General law and special law – Transfer of Property Act, 1882 is general law – Specific Rent Control Acts are special laws being advancement over Act, 1882 providing more protection to the tenant from arbitrary increase of rent and ejectment from the rented premises by the landlord – Transfer of Property Act, 1882 is not applicable in respect of the public premises – Instantly, the DDA flat being public premises not governed by Act, 1882. (Para 25)

       (c) Delhi Development Act, 1957 r/w Delhi Development Authority (Disposal of Developed Nazul Land) Rules, 1981 and Section 2(g) of the Public Premises (Eviction of Unauthorised Occupants) Act, 1971 – Renewal of lease refused by DDA – Status of original lessee – Unauthorised occupant – Acceptance of certain amount as rent and certain sums towards change to freehold from lease hold – Irrelevant aspects – Termination notice dated 01.09.1972 stating not only refusal to renew the lease but also declaring respondent no. 1 as ‘unauthorized person’. (Para 28, 29)

       (d) Code of Civil Procedure, 1908 – Order XXII rule 10 – Substitution of original lessee by respondent no. 1 by reason of sale deed – Lease of original lessee not renewed by DDA – Original lessee had no title or right – Sale deed not binding on DDA – Order of substitution void. (Para 32)

       (e) Public Premises (Eviction of Unauthorised Occupants) Act, 1971 – Section 2(g) – In absence of renewal of lease original lessee becoming unauthorised occupant – Not entitled to deal with the property in any manner – Deposit of requisite amount by respondent for conversion from leasehold to freehold – Of no relevance – Concept of conversion of leasehold rights to freehold rights not applicable to the facts of the case. (Para 33)

       (f) Public Premises (Eviction of Unauthorised Occupants) Act, 1971 – Section 7 – Original lessee occupying premises unauthorisedly for 30 years – Thereafter respondent enjoying the property for 17 years – DDA empowered to claim damages from them – Both liable to pay the damages for unauthorised occupation – DDA directed to take possession of property immediately. (Para 35)

       Facts of the case:

       The Delhi Improvement Trust (predecessor o DDA) vide lease deed dated 06.01.1951 granted lease of plot no.2, Jhandewalan, “E” Block, Delhi in favour of original lessee Balraj Virmani.

       The lease was initially for a period of 20 years i.e., w.e.f. 11.08.1948 to 10.08.1968 and the same was liable to be extended for a further period of 20 years at the option of lessee in accordance with the terms and conditions contained therein.

       On 23.02.1967, the original lessee approached the DDA for renewal of his lease. The DDA served a show cause notice dated 16.02.1968 to the original lessee for breach of the terms and conditions contained in the lease deed committed by him with respect to the lease.

       The DDA vide notice dated 01.09.1972 terminated the lease of the said land on account of non-observation of the terms and conditions contained in the lease deed.

       Aggrieved by the decision of the DDA, the original lessee filed original suit for perpetual injunction seeking restraining order against the DDA. The suit was decreed in favour of the original lessee.

       DDA preferred the First Appeal which was dismissed.

       DDA preferred the Second Appeal before the High Court. During the pendency of the second appeal an application was moved under Order 22 Rule 10 of the CPC for substitution of M/s Anant Raj Agencies Pvt. Ltd. the respondent herein in place of original lessee-Balraj Virmani which was allowed.

       The High Court has dismissed the second appeal filed by the DDA holding that its act of demanding and accepting rent tantamounts to renewal of lease in respect of the property in question.

       Finding of the Court:

       Findings of the courts below on the contentious issue is not only erroneous but also suffers from error in law.

       Result: Appeal allowed with cost.