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IN THE HIGH COURT OF KERALA AT ERNAKULAM
HARISANKAR V. MENON, J.
T.M. Biju, S/o. Madhavan – Appellant
Versus
Indian Oil Corporation Ltd. –Respondent
W.P(C) No.39962 of 2017 and 38439 of 2018
Decided on : 04-12-2024
(A) Constitution of India - Article 226 - Transfer of Property Act, 1881 - Section 116 - Writ petitions concerning lease agreements - Petitioners sought eviction of respondent Corporation post-lease expiration - Court held that petitioners could invoke writ jurisdiction and direct eviction as lease validity had lapsed - Respondent's claim of 'holding over' under Section 116 rejected due to lack of mutual agreement for renewal. (Paras 11-22)
(B) Writ Jurisdiction - Scope and limitations - Court clarified that writ jurisdiction can be invoked for eviction when lease has expired and no renewal agreement exists. (Paras 11-14)
Facts of the case:
Petitioners leased property to M/s.IBP Pvt. Ltd. which merged with Indian Oil Corporation; lease expired, and petitioners sought eviction. Respondent claimed tenancy rights based on continued rent payments.
Findings of Court:
Petitioners entitled to evict the respondent Corporation as lease had expired and no renewal was agreed upon.
Issues: Whether petitioners can invoke writ jurisdiction for eviction; whether respondent can claim tenancy rights post-lease expiration; applicability of Section 116 of the Transfer of Property Act.
Ratio Decidendi: Court ruled that mere acceptance of rent does not imply renewal of lease; petitioners' clear intent not to renew excludes application of Section 116.
Result: W.P
(C) No.38439 of 2018 allowed; W.P
(C) No.39962 of 2017 dismissed.
JUDGMENT :
[W.P(C) Nos.39962/2017 and 38439/2018]
These writ petitions pertain to a retail outlet of the Indian Oil Corporation Limited (hereinafter referred to as the “respondent Corporation”) in the property leased out by the petitioners in W.P(C) No.38439 of 2018 and run by the petitioner in W.P(C) No.39962 of 2017, pursuant to an allotment by the respondent Corporation.
2. The short facts necessary for the disposal of these writ petitions are as follows:
The petitioners in W.P(C) No.38439 of 2018 are stated to be in joint ownership of about 35.20 Ares of property in Re-Survey No.104/2 in Kuthuparamba Village in Kannur District. Out of the afore property, the petitioners leased out 30 cents to M/s.IBP Pvt. Ltd. in 2003, as evidenced by Ext. P1. The term of the lease, as seen from Ext.P1, was for 15 years from the date of commencement of the activities of storage/sale of petroleum products – 30.5.2003. The petitioners state that an outlet was established in the afore property by M/s.IBP Pvt. Ltd., which is a “Company Owned and Company Operated” (COCO), outlet and the maintenance and handling of the dealership were entrusted with their son. However, the petitioners point out that later the entrustment to their son was cancelled with effect from 01.02.2007. M/s.IBP Pvt. Ltd. was, in the meantime, merged with the 1st respondent herein in 2007, and the respondent Corporation allotted the dealership to the 3rd respondent in this writ petition, Sri. T.M.Biju (the petitioner in W.P(C) No.39962/2017). The petitioners further state that they were served with Ext.P4 communication dated 10.05.2017, informing that the lease deed at Ext.P1 is expiring on 29.05.2018 and the same requires to be renewed. They point out that by Ext.P5 letter dated 22.05.2018, the respondent Corporation was informed that the petitioners are no longer interested in renewing the lease deed any further and, therefore, the respondents have to quit, vacate, and deliver quiet and peaceful possession of the premises covered by Ext. P1 on or before 30.05.2018. In response, Ext.P6 letter dated 13.06.2018 was issued by the respondent Corporation informing that, they were under a legitimate expectation that they could continue for a minimum of 30 years, and that is why substantial amounts were invested in the property for establishing the retail outlet. The petitioners point out that the property in question is situated in the heart of Kuthuparamba town and worth atleast Rs.10 Crores, and they were being paid only Rs.30,000/- per month.
3. In such circumstances, W.P(C) No.38439 of 2018 is filed seeking a direction to the respondents to quit, vacate, and deliver quiet and peaceful possession of the premises covered by Ext.P1 lease deed. The petitioners also seek a declaration that respondents 1 and 2 are occupying the petitioners' land illegally and that it is an unethical practice by a Government-owned company.
4. The second writ petition, W.P(C) No.39962 of 2017 is filed by the allottee of the dealership by the respondent Corporation, who is the 3rd respondent in W.P(C) No.38439 of 2018, pointing out that he is a member of a Scheduled Caste, that he has invested substantial amounts in running the retail outlet, that he is eking his livelihood from the afore outlet and that the respondent Corporation is proposing to terminate the retail outlet on account of the stand taken by the owners of the land who are the petitioners in W.P(C) No.38439 of 2018. He seeks for an order directing the respondent Corporation to allow him to continue the conduct of the retail outlet.
5. Separate counter affidavits have been filed by the respective respondents in these writ petitions, seeking to sustain the impugned action.
6. I have heard Sri.S.Krishna Prasad, the learned counsel for the petitioners in W.P(C) No.38439 of 2018, Sri.M.Ramesh Chander, the learned senior counsel for the petitioner in W.P(C) No.39962 of 2017 and Dr.Thushara James, the learned Standing Counsel for the respondent Corpor
The court affirmed that mere acceptance of rent does not imply lease renewal, allowing eviction under Article 226 when the lease has expired without mutual agreement for renewal.
The main legal point established in the judgment is that the expiration of a lease, suppression of material facts, and the effect of holding over under the Transfer of Property Act, 1882 were central....
The court established that a writ petition for eviction is maintainable when the facts are straightforward, and public sector undertakings are not above the law regarding lease agreements.
The continued occupation of leased property by a public body post-expiration is arbitrary and warrants judicial intervention under Article 226 of the Constitution.
A Statutory Corporation, which is a State within meaning of Article 12 of Constitution of India, is not expected to act in blatant disregard to law.
The central legal point established in the judgment is the interpretation and applicability of Section 116 of the Transfer of Property Act, 1882, particularly in cases where rent control legislation ....
The writ court under Article 226 of the Constitution can issue appropriate writs in appropriate situations to arrest or remedy palpable injustice caused to any litigant public, and further can direct....
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