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2011 Supreme(Cal) 1410
High Court Of Calcutta
J.K. Biswas, J.
Jayanti Paul : Appellant
Versus
Kolkata Metropolitan Development Authority : Respondent
W.P. No.17296 (W) of 2009
Decided On : Nov 14,2011
Saktinath Mukherjee, Deba Prasad Mukherji, Debjit Mukherjee, Santanu Chatterjee, Partha Sarathi Basu
The cancellation of a private law lease by a State within the meaning of Art. 12, asserting a right under the lease and not by authority of any law or executive action, cannot be challenged under Art. 226 by the lessee on the grounds that it is unfair, unreasonable, and arbitrary, and violative of Art. 14 and Art. 300A of the Constitution of India.
Headnote:
LEASE CANCELLATION - MAINTAINABILITY OF WRIT PETITION - PUBLIC LAW ELEMENT - ART. 300A OF THE CONSTITUTION OF INDIA - PRIVATE LAW CONTRACTUAL RIGHT - WRIT COURT JURISDICTION - PROPERTY DEPRIVATION - AUTHORITY OF LAW - ART. 14 OF THE CONSTITUTION OF INDIA - FAIRNESS, REASONABLENESS, AND NON-ARBITRARINESS.
Fact of the Case:
The petitioners challenged the decision of the Kolkata Metropolitan Development Authority (KMDA) to cancel their lease for a residential plot due to non-completion of construction within the stipulated time frame. The lease deed contained a clause allowing KMDA to re-enter the demised premises upon any breach of the lessee's covenants.
Finding of the Court:
The court held that the petitioners' remedy, if any, was before the Civil Court, as the cancellation of the lease by KMDA was an exercise of its pure private law contractual right and did not involve any public law element. The court further held that Art. 300A of the Constitution of India, which prohibits deprivation of property save by authority of law, does not apply to such cases, as the deprivation was not by authority of an unconstitutional law but by authority of a valid private law contract.
Issues: 1. Whether the petitioners could challenge the cancellation of the lease under Art. 226 of the Constitution of India, alleging violation of Art. 14 and Art. 300A due to unfair, unreasonable, and arbitrary action by KMDA. 2. Whether the cancellation of the lease by KMDA was an exercise of its public law power or a private law contractual right.
Ratio Decidendi: 1. The court held that the petitioners could not challenge the cancellation of the lease under Art. 226, as it was not a public law action but an exercise of KMDA's private law contractual right. 2. The court held that the cancellation of the lease was not a deprivation of property save by authority of law, as it was done in accordance with the terms and conditions of the lease deed, which was a valid private law contract.
Final Decision: The court dismissed the petition, holding that it was not maintainable and that the petitioners' remedy, if any, was before the Civil Court.
1. THE petitioners in this art.226 petition dated September 22, 2009 are questioning a decision of the Kolkata Metropolitan Development Authority (hereinafter referred to as "the Authority") dated September 15, 2009(p.59).
2. THE relevant parts of the decision are quoted below:
"With reference to the above, this is to inform you that 200 Sq.mtr. of HIG plot was allotted to Sri Bibhuti Bhusan Paul. After actual measurement of the plot no.C-15, under BPADP measuring 200 Sq.mtr. the possession of land was delivered to you. According to terms and conditions of the Lease deed executed with you on 15.07.1988, the allottee had to complete of the construction of the residential house within 5(five) years from the date of execution of Lease deed i.e. within 1993. Within this period even the permission from the Kolkata Muicipal Corporation for construction had not been obtained. The allottee later passed away in 1995. However, it is found that you have not as yet started construction. This is clearly against the terms and conditions of the Lease deed executed by you. Therefore, as per the terms and conditions enumerated in the Lease deed, the offer of allotment of plot no.C-15, HIG is hereby cancelled and possession of land delivered is withdrawn. Lease deed executed thus stands cancelled. The amount paid by you will be refunded after deduction of 20% as service charge."
Clause 2(iii) of the lease deed provided as follows:
"2.The LESSEE to the intent that the obligations and covenants shall continue throughout the period of demise agrees and covenants with the Authority as follows:- ..
(iii) At the own cost of the LESSEE who has been allotted plot, within five years from the date hereof or within such further time as the Authority may at its option allow in writing on sufficient and reasonable grounds, to erect, construct and complete a house or building for being used for residential purposes with boundary walls, sewers and drains in accordance with plans, sections and specifications as may be approved by the appropriate body according to the rules and regulations framed for the purpose."
3. CLAUSE 4 of the lease deed provided as follows:
"4.(i) If there be any breach of any covenant on the Lessees part herein contained and to be performed or observed or any of the terms and conditions hereof, then in the said cases it shall be lawful for the Authority at any time thereafter to re-enter upon the demised premises or any part thereof in respect of any breach of the Lessees covenants herein contained.
(ii)Any notice requiring to be served hereunder shall be sufficiently served on the Lessee if addressed to him on the demised premises or forwarded to him by registered post or left at his last known address in India and shall be sufficiently served on the Authority if delivered to the office of the Deputy Director(Marketing and Management) against proper receipt. A notice served by post shall be deemed to be given at the time when in due course of a registered post it would be delivered at the address to which it is sent.
(iii) Any relaxation or indulgence granted by the Authority to the Lessee or by the said Lessee to the Authority shall not in any way prejudice the rights of the parties under this Deed of Lease."
4. MR. Basu appearing for the Authority, and relying on the decision I gave in Haldiram Ltd. v. State of West Bengal and Ors., (2009) 1 Cal LT 158 (HC), and the decisions in State of Orissa v. Ram Chandra Dev, AIR 1964 SC 685, Bareilly Development Authority and Anr. v. Ajai Pal Singh and Ors.,(1989) 2 SCC 116, Indu Kakkar v. Haryana State Industrial Development Corporation Ltd and Anr., AIR 1999 SC 296, Bhavnagar University v. Palitana Sugar Mill (P) Ltd., (2003) 2 SCC 111 and Supriyo Basu and Ors. v. W.B. Housing Board and Ors., (2005) 6 SCC 289, - has questioned the maintainability of the petition.
Mr. Basu has heavily relied on the case stated in sub-para.(c) of para.3 of the opposition dated March 23, 2010 filed on behal
