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2024 Supreme(Cal) 984

IN THE HIGH COURT AT CALCUTTA
RAI CHATTOPADHYAY, J.
Pradip Dhar – Petitioner
Versus
United Bank of India & Ors. – Respondents
WPA 13468 of 2019 With IA No. CAN 1 of 2020 with IA No. CAN 2 of 2020
Decided On : 29-08-2024

Advocates Appeared:
For the Petitioner: Mr. Ashim Kr. Routh, Ms. Ananya Mondal, Mr. Subhayan Banik.
For the Respondent: Mr. Abhishek Banerjee.

IMPORTANT POINT
A writ petition can enforce contractual obligations against a public authority when the matter involves public functions, despite being a private contract.

Headnote:

Lease - Non-compliance - Article 226, Indian Constitution - The court interpreted the lease agreement and the obligations of the bank under it, emphasizing the public function doctrine and the applicability of Article 226 in enforcing contractual obligations against a public authority.

Fact of the Case:

The writ petitioner claimed non-compliance with a lease agreement by the respondent bank, seeking unpaid rent and taxes from January 2015 to August 2018, totaling Rs. 11,56,350, along with interest.

Finding of the Court:

The court found that the respondent bank had a duty to comply with the lease agreement and that its failure to do so constituted inaction and arbitrariness, justifying the writ petition's maintainability.

Issues: Whether the writ petition is maintainable for enforcing a private lease agreement against a public authority and whether the bank failed to comply with its contractual obligations.

Ratio Decidendi: The court held that a writ petition can be maintained against a public authority for breach of a private contract if it involves public functions, emphasizing the public function doctrine.

Result: The writ petition is allowed, and the respondent bank is ordered to pay the petitioner the claimed amounts with interest.

JUDGMENT :

(Rai Chattopadhyay, J.) :

1. The writ petitioner’s grievance is with respect to the alleged non-compliance with the terms of lease agreement by the respondent bank, also regarding non-payment by the respondent authority of the rent and taxes with regard to the premises leased out to it, by the predecessor of the petitioner. It is stated that the rent amount has remained unpaid from January 2015 till August 27, 2018. Likewise the corporation tax and charge have been due from July 2014 till August 2018. The property was handed over to the petitioner by the respondent/bank on August 27, 2018.

2. Hence, this writ petition, to seek redress as regards the alleged inaction and for direction that:-(i) an amount of Rs. 9,84,157/- be paid by the respondent/bank to the writ petitioner on account of rent calculated from January 2015 to August 2018 and; (ii) an amount of Rs. 1,72,193/-on account of corporation tax and such charges calculated from July 2014 to August 2018, be also paid by the respondent/bank – totalling the sum of Rs. 11,56,350/-, with an interest at rate of 12% per annum till the date of its payment.

3. It is necessary that the factual background may be discussed in a nut shell, as follows:-

4. The premises is situated at 94, Bidhan Sarani, Police Station – Shyampukur, Kolkata – 700004. The property devolved upon the writ petitioner by dint of the Court’s order and the petitioner is the owner thereof, in exclusion of right of any other person as to the said property.

5. A registered lease deed was executed by the predecessor-in-interest of the writ petitioner on December 13, 2011. The lessee thereof was the respondent/bank. According to the deed as above, the period of lease was for 12 years, effective from August 1, 2011, and ending on August 1, 2023. The rent was also fixed therein. According to the terms of the lease, the lessee bank was to reimburse the entire 100% of the occupier’s share of corporation tax and also the entire 100% of the commercial surcharge relating to the occupied space, with effect from August 1, 1998, as per the previous agreement and as per consolidated rate bill of Kolkata Municipal Corporation. The bank started functioning in the premises as above with effect from August 1, 2011, on the basis of renewal of the agreement between the parties, afresh.

6. After death of the original lessor on January 1, 2015, and after the property devolved upon him, the writ petitioner took steps for realization of the rent and corporation taxes from the respondent/bank with respect to the leased out property as above. First of his letters to the respondent in this regard is dated February 7, 2015. The petitioner has mentioned in the writ petition about the date of handing over the vacant possession of the said leased out property by the bank to him, that is, on August 27, 2018. Receipt of rent up to December 2014 is not denied by the writ petitioner. Similarly receipts of corporation taxes and surcharges upto June 2014, is also admitted. Therefore, the petitioner says that since in spite of several letters having been sent to the respondent/bank, it has not acted upon those, by paying rent, tax and surcharges of the residuary period, till delivery of possession of the property to the writ petitioner, which would have been otherwise, the legal dues payable by the bank to the petitioner, in terms of the lease deed as mentioned above. Thus allegedly, the rights and entitlement of the petitioner is jeopardized. The petitioner has sought for redress and appropriate order.

7. Mr. Routh is appearing on behalf of the writ petitioner. He tries to convince the Court as to the fact that in this case there has been gross and blatant disregard of the petitioner’s valuable rights, protected pursuant to the agreement entered into by his predecessor and the respondent/bank. According to the terms of agreement, that is, the lease deed dated December 13, 2011, the respondent/bank was to act in a stipulated way specified

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