Reva Khetrapal, J.

IA Nos. 10668/2007 (under Order XXXIX Rules 1 and 2 CPC filed by the plaintiff) and 14630/2007 (under Order XXXIX Rule 4 CPC filed by the defendant)

1. By this order, it is proposed to decide IA No. 10668/2007 under Order XXXIX Rules 1 and 2 CPC filed by the plaintiff and IA No. 14630/2007 under order XXXIX Rule 4 CPC filed by the defendant.

2. The background facts are that tenders were invited in the year 2001 by the defendant for allotment on licence/lease basis of various properties including the property commonly known as Open Air Restaurant, Minto Bridge, Minto Road, New Delhi. The plaintiff was declared a successful bidder by the defendant and the bid of the plaintiff was accepted by the defendant vide letter dated 11.10.2001 and by the same communication the defendant directed the plaintiff to deposit a sum of Rs. 30,66,707/- as licence fee for the first six months and one month's licence fee payable in advance and to execute a deed of licence in the form approved by the Commissioner, MCD. The terms and conditions of the licence were also supplied to the plaintiff. The plaintiff deposited the aforesaid amount as demanded by the defendant and an agreement was executed between the parties on 08.01.2002. Clause 22 of the said agreement reads as under:-

"Clause 22: The period of licence will be five years or on termination of the licence whichever is earlier from the date taking over the premises and the extension of allotment may be allowed for further period of five years after 50% increase in licence fee."

3. Pursuant to the execution of the aforesaid agreement, according to the plaintiff, the possession of the Open Air Restaurant, Minto Road, Delhi was handed over by the defendant to the plaintiff on 28.02.2002 and the plaintiff started running its business from the said place under the name and style of "Cup-n-Saucer Open Air Restaurant" with the land appurtenant thereto. Thus, the licence of the plaintiff was to expire on 28.02.2007. The plaintiff, however, asserts in the plaint that the last payment towards the licence fee was made on 04.06.2007, amounting to Rs. 35,04,808/-, which was acknowledged by the defendant vide receipt No. 262094 dated 04.06.2007.

4. The further case of the plaintiff is that the policy of the Government of India, which was binding on the defendant/MCD and which it was bound to follow qua its properties, being a statutory body in the Union Territory, was to confer freehold property rights to the occupiers/allottees in the markets. The plaintiff asserts that initially it was meant for rehabilitation markets and thereafter extended to others from time to time. Ownership rights in these markets were conferred after charging the percentage between 50% to 80% of the premium of land at the predetermined commercial rates notified and existing on the date of transfer for the locality/area where the shop/property was located, plus the replacement cost of the land premises on the relevant day minus depreciation. Besides this, the annual rent at the rate of 2.5% of the premium/cost of the land calculated at the existing land rates became payable. In the year 2000, the Central Cabinet in modification of its earlier policy agreed to convert the said properties into freehold properties in the hands of the allottees/lessees/occupiers on payment of 100% premium of commercial land rates.

5. It is further the case of the plaintiff that the defendant/MCD adopted the aforesaid policy of the Ministry of Urban Development and Poverty Alleviation (Directorate of Estates) to confer freehold rights. The Standing Committee of the defendant vide its Resolution No. 336 dated 26.10.2005 approved the proposal of the Commissioner as contained in his letter dated 25.10.2005. Another Resolution No. 494 dated 21.11.2005 was also passed by the MCD regarding conversion of markets and colonies from licence fee basis to leasehold basis and then freehold basis. The plaintiff accordingly applied for conversion of the su