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2025 Supreme(Chh) 408

HIGH COURT OF CHHATTISGARH AT BILASPUR
Narendra Kumar Vyas, J.
Rahul Bajpai S/o Late Shri Pandit Rohini Kumar Bajpai - Appellant
Versus
Chhattisgarh State Industrial Development Corporation Ltd. - Respondent
FA No. 185 of 2016
Decided On : 22-07-2025

Advocates Appeared:
For the Appellant :Mr. Abhyuday Singh, Advocate
For the Respondent:Mr. Ayaz Naved, Advocate

Express conditions in a lease must be strictly adhered to; violation justifies cancellation based on section 111(g) of the Transfer of Property Act.

Headnote:(A) Transfer of Property Act, 1882 - Section 111(g) - Lease Agreement - Cancellation of lease due to alleged violation of terms - Plaintiff's appeal dismissed; court found sufficient basis for the defendant's actions under lease provisions - Key clauses outlined set conditions for lease usage and potential cancellation - Plaintiff failed to provide evidence disproving violation allegations. (Paras 18-26)

(B) Natural Justice - Failure of the plaintiff to receive proper notice about hearings did not invalidate the appellate process - The concept of natural justice was addressed while affirming that due process was ultimately followed. (Paras 14-16)

Facts of the case:
Plaintiff, an industrialist, challenged the defendant's cancellation of lease deeds pertaining to manufacturing land. Post-business downturn, the plaintiff attempted to change use without permission. Defendant claimed this violated lease terms, leading to cancellation.

Findings of Court:
The court ruled in favor of the defendant, affirming cancellation under lease conditions and section 111(g) of the Transfer of Property Act, validating the dismissal of the plaintiff's appeal.

Issues: Whether the plaintiff violated lease conditions warranting cancellation; adherence to principles of natural justice in appellate proceedings.

Ratio Decidendi: The court determined that the plaintiff had indeed violated express conditions of the lease, justifying cancellation. The appeal was dismissed as the plaintiff failed to adequately counter the allegations presented by the defendant.

Result: Appeal dismissed.

Table of Content
1. details of the lease agreements and cancellation (Para 1 , 3 , 4)
2. arguments from both parties regarding lease violations (Para 5 , 13 , 14)
3. trial court's analysis based on evidence presented (Para 6 , 8 , 12 , 17 , 18)
4. application of legal standards for lease cancellation (Para 19 , 20 , 21 , 22)
5. final decision and dismissal of appeal (Para 23 , 24)

JUDGMENT :

Narendra Kumar Vyas, J.

1. This first appeal under Section 96 CPC has been filed by appellant/ plaintiff assailing the judgment and decree dated 30.04.2016 passed by learned 5th Additional District Judge, Bilaspur in Civil Suit No. 24-A of 2013, by which the trial Court has dismissed the suit filed by the plaintiff for declaration that no provision of lease deed has been violated, therefore, the defendant has no right to dispossess the plaintiff from the suit property.

2. For the sake of convenience, the parties shall be referred to in terms of Civil Suit No. 24-A/2013.

3. Brief averments as pleaded in the plaint are as under:-

(a) That the appellant is the proprietor of M/s. R.K. Udyog, the said company was involved in production of Aluminum Notch Bars and supply the same to small scale steel plants. A lease deed was executed between M/s. R.K. Udyog and defendant for admeasuring 3600 Sq. feet land situated at Tifra Industrial Estate, District Bilaspur, The said land is hereinafter referred to as “suit land”.

(b) It is contended that the lease deed was executed between the appellant and the defendant twice. First lease deed was executed between the appellant and the defendant from 06.11.1982 to 05.11.2012 for 30 years. Second lease deed was executed between them from 16.02.1989 to 15.02.2088 for 99 years. Thereafter, on 13.08.1991 a conveyance sale deed was executed between the plaintiff and defendant No. 1 wherein the appellant purchased the shed on the suit land measuring 1800 Sq. feet from respondent for sum of Rs. 23,927/-.

(c) It is also contended that M/s. R.K. Udyog used to produce aluminum notch bars and supply the same to small steel plants for cleaning melt iron and due to recession, appellant suffered huge loss in the business and he had to face difficulty for recovery of its own money, therefore, he decided to wind up the said industry by reducing production, as such he had to close the plaint completely in the year 2004 and thereafter, he tried to establish new unit for manufacturing plastic scrap on the suit land, therefore, he started collecting more raw material for manufacturing plastic scrap in the said shed, so that he may not face shortage of raw material in future.

4. It is also contended that before the plaint could be established on 01.03.2006 the defendant ordered for cancellation of lease deed dated 06.11.1982 and order dated 16.02.1989 on the ground for violation of certain provisions mentioned in the lease deed. The defendant conducted investigation in the said premises and alleged panchnama was prepared by them in absence of appellant without following due process of law. Being aggrieved by the order dated 01.03.2006 of cancellation of lease deed, the appellant preferred an appeal before Chairman, CSIDC, Raipur. However, the appeal filed by the appellant has been dismissed by the Appellate Authority without opportunity of hearing given to him vide order dated 29.11.2006 and directed the appellant to handover the land to the defendant No. 1 by 10.10.2007.

5. The defendant has filed his written statement denying the allegation made in the plaint mainly contending that after production was stopped thereafter, the plaintiff gave the said unit on rent violating clause-12 of the agreement. It has contended that the other condition of the lease deed was also violated by the plaintiff and he has tried to close old industry and set up new industry, therefore, the plaintiff was required to obtain permission from defendant No. 1 before closing old industry and setting up new industry but he did not take permission which is violative clau

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