Lease renewal depends on commercial considerations and does not confer enforceable rights on the lessee. The issue of alleged arrears of rent can be agitated before the Civil Court.

ORDER

1. Leave granted.

2. Respondent no.2 herein had allotted a plot/land admeasuring 33m X 21 m (693 sq.mtr.) in Sector-25, Gurgaon Mehrauli Road, Gurgaon, Haryana, to the appellant herein for the purpose of setting up of a petrol pump. The period of lease for which a lease deed was also executed was 15 years. Some of the clauses in the said lease dead which are relevant part for our purpose are mentioned below :

"a. As per Clause 2 of the Lease deed petitioner corporation has to pay Rs.15,570/- per month, which is subject to revision @ 25% after 3 years. (This clause undisputedly has been duly complied with by the petitioner corporation).

b. Clause 7A provides for extra rent @ 12.5% per month for every additional "Filling Point" constructed by the petitioner corporation.

c. Clause 26 provides that opportunity of hearing be granted before Estate Officer in case of breach of terms and conditions."

3. It is a matter of record that dispute arose between the parties about the rate at which the extra rent as mentioned in clause 7A of the lease deed was to be paid by the appellant to respondent no.2. When the period of lease expired, as on that date as per respondent no.2, a sum of Rs.78,17,377/- as arrears of rent was payable which was not paid by the appellant. For this reason, respondent no.2 refused to renew the lease and rejected the request of the appellant to convert the lease to 99 years perpetually. Against the said rejection, the appellant filed the writ petition in the High Court which has been dismissed by the impugned judgment dated 27.8.2014 passed by the High Court in the following manner :

"We have heard learned counsel for the petitioner and find no merit in the present petition. Whether after the expiry period the lease should be extended or not depends upon the commercial considerations of the respondents. Merely, because the lease has not been extended, will not confer any enforceable right on the petitioner to seek extension of lease in terms of policy/guidelines. The policy/guidelines are not statutory and are issued for uniform applicable to avoid have arbitrariness but such policy guidelines do not confer any enforceable right in favour of lessee. Still further, whether the claim of respondents against the petitioner of over Rs.78.00 lacs is illegal or against the judgment of Civil Court, it is for the petitioner to avail the remedy which may be available to the petitioner consequent to the judgment and decree of the Civil Court. However, they will not be entitled to seek conversion of fixed period lease after its expiry into perpetual lease."

4. Two things can discern from the aforesaid observations of the High Court :

(1) Insofar as renewal of lease is concerned, it was the prerogative of respondent no.2. The High Court has remarked that it depends upon the commercial consideration of the respondent and if respondent no.2 chose not to extend the same, no enforceable rights accrue in favour of the appellant.

(2) Insofar as payment of Rs.78 lakhs on account of alleged arrears of rent is concerned, the High Court has permitted the parties to agitate the said issue before the Civil Court.

5. The appellant challenged the aforesaid order by filing the instant appeal.

6. Various orders were passed from time to time so that some mutual acceptable solution is arrived at. This was done keeping in view the fact that the appellant " corporation is a Public Sector Undertaking like respondent no.2.

7. We may record at this stage that as per respondent no.2, the land in question is required for larger public purpose namely the highway. It is also stated that entire highway is constructed but it is not operative because of the fact that this petrol pump being on the subject land is coming in the way. Therefore, there is a dire necessity to have this site vacated from there. At the same time, respondent no.2 is also agreed to give alternate site to the appellant. This aspect was considered today before us. Proceedings of