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IN THE HIGH COURT OF BOMBAY
Sharmila U.Deshmukh, J.
Life Insurance Corporation of India - Appellant
Versus
National Insurance Company Ltd - Respondent
Writ Petition No . 9224, 10075 of 2010, Interim Application No. 1818, 20225 of 2022
Decided On : 07-10-2023
PUBLIC PREMISES - EVICTION OF UNAUTHORISED OCCUPANTS - Public Premises (Eviction of Unauthorised Occupants) Act, 1971, Sections 4, 5, 7; Transfer of Property Act, 1882, Section 106 - The court discussed the provisions of the Public Premises (Eviction of Unauthorised Occupants) Act, 1971, particularly Sections 4 and 5, which require the Estate Officer to specify grounds for eviction and conduct an inquiry into the unauthorized occupation. The court emphasized that public bodies must act fairly and in public interest, as established in previous judgments. The interpretation of Section 106 of the Transfer of Property Act was also considered, highlighting that while it does not require grounds for termination, the inquiry into the validity of termination is necessary under the PPE Act. The court concluded that the termination of tenancy by LIC was unjustified, as the use of the premises as temporary accommodation for employees did not constitute a change of user warranting eviction.
Fact of the Case:
LIC terminated the tenancy of NIC for a flat, alleging unauthorized use as a guest house, arrears of rent, and bonafide requirement. NIC contested the eviction, claiming the premises were used for temporary accommodation for employees. The Estate Officer ordered eviction and recovery of rent and damages, which was partly upheld by the Appellate Authority.
Finding of the Court:
The court found that the termination of tenancy by LIC was not justified. The use of the premises as temporary accommodation did not amount to a change of user. The court emphasized the need for public bodies to act fairly and in public interest, and that the grounds for eviction were not sufficiently established.
Issues: 1. Whether the termination of tenancy by LIC was justified based on fairness expected of public bodies. 2. Whether the grounds for eviction as stated in the notice were proven.
Ratio Decidendi: The court held that the termination of tenancy must be justified and informed by reason, especially when public bodies are involved. The inquiry into the validity of termination is necessary, and the use of premises as temporary accommodation does not constitute a change of user warranting eviction.
Final Decision: Writ Petition No.10075 of 2010 was allowed, and the order of eviction was set aside. Writ Petition No.9224 of 2010 was dismissed.
JUDGMENT/ORDER
SHARMILA U.DESHMUKH, J. - Heard.
2. Both the Petitions invoke the jurisdiction of this Court under Article 227 of Constitution of India to challenge the order of the Appellate Authority dtd. 26/10/2010 passed in Misc. Appeal No 28 of 2009 filed against the order of the Estate Officer dtd. 18/12/2009. The Petitions were heard together and are being disposed of by common judgment.
3. Vide order dtd. 18/12/2009, the Estate officer passed an order of eviction under Sec. 5 of Public Premises (Eviction of Unauthorised Occupants) Act, 1971 (for short PPE Act), recovery of arrears of rent with interest under Sec. 7(1)(2A) of PPE Act, and, recovery of damages with interest under Sec. 7(2)(2A) of PPE Act. The Appellate Authority partly allowed the appeal and set aside the order of recovery of arrears of rent and reduced the quantum of damages. The order of eviction was upheld.
4. Writ Petition No.9224 of 2010, filed by the original Applicant, challenges clause Nos.4 and 5 of the impugned order which reduces the quantum of damages and keeps in abeyance the executability of the order till the decision of High Power Committee respectively. Writ Petition No.10075 of 2010 filed by original Opponent takes exception to the impugned order of eviction and payment of damages.
5. The Applicant before the Estate Officer was Life Insurance Corporation of India and the Opponent was National Insurance Company Limited. For the sake of convenience, the parties are referred to as LIC and NIC.
6. LIC is a corporation established under the Central Act XXXI of 1995 and NIC is a Government company incorporated under Indian Companies Act, 1956 and owned by the Central Government. LIC is the owner of Flat No.2A located on 2nd floor of building known as Jivan Jyot, situated at Setalvad Lane, Nepean Sea Road, Mumbai-400 036 which was let out to NIC since the year 1957. On 28/3/2007, vide Advocate's notice LIC terminated the tenancy on the ground of change of user to guest house, causing nuisance, bonafide requirement and arrears of rent and called upon NIC to handover possession of the subject premises. The notice was responded by NIC vide reply dtd. 27/4/2007 denying the contents of the notice under reply. As NIC failed to vacate and surrender the subject flat, a composite application under Sec. 4 and Sec. 7 of PPE Act was filed by LIC on 17/5/2007.
7. On 23/5/2007 the Estate officer issued a show cause notice in Form A under sub-sec. 1 and clause (b)(ii) of sub-sec. 2 of Sec. 4 of PPE Act, stating that the Estate officer is of the opinion, on the grounds specified therein, that the noticee is in unauthorised occupation of the public premises and should be evicted from the said premises. The grounds for eviction were stated as under :
<WXY>"1. The Opponent has illegally and without the permission of the applicants changed the user of the scheduled premises.
2. The Opponent is in arrears of rent from August 2000 to April 2007.
3. The Applicants require the scheduled premises for its bonafide use.
4. Applicants vide Notice dtd. 28/3/2007 terminated the tenancy and authority of the Opponent. Since the Opponent has failed and neglected to comply with the requirements of the Notice, they have become unauthorised occupant in the scheduled premises w.e.f. 1. 5.2007 and they are (a) liable to be evicted from the scheduled premises and (b) pay arrears of rent and damages respectively with interest."</WXY>
8. Notices in Form (D) and Form (F) under sub-sec. 3 of Sec. 7 of PPE Act, were issued to show cause as to why an order requiring NIC to pay the arrears of Rs.2,42,422.00 towards repairs and maintenance and damages of Rs.7,30,244.00 together with simple interest should not be made respectively.
9. NIC filed its reply dtd. 15/6/2007 to the show cause notices issued by the Estate officer seeking dismissal of the application.
10. In support of its case LIC examined three witnesses viz. Building Inspector Sandip P. Sitap, Administrative officer Ms. Sanjivani Palekar and
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