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2026 Supreme(Online)(Ker) 27594
IN THE HIGH COURT OF KERALA AT ERNAKULAM
EASWARAN S., J
Dr.Mathew Philip – Appellant
Versus
M/s.Hindustan Petroleum Corporation Ltd. – Respondent
RSA NO. 968 OF 2011 | AS NO.252 OF 2004 | OS NO.131 OF 1996
For the Appellants/Petitioners: SRI.R.AZAD BABU
For the Respondents: SHRI.BENNY P. THOMAS (SR.), SHRI.M.GOPIKRISHNAN NAMBIAR, SHRI.K.JOHN MATHAI
Successor lessees from foreign company via government vesting cannot claim Section 106 Kerala Land Reforms Act non-evictability protections.
Headnote:The lease of property for a petroleum outlet, initially granted to a foreign company in 1952 for ten years and renewed in 1962, vested in the Central Government under ESSO (Acquisition of Indian Undertakings) Act No.74 of 1976, and was later assigned to the respondent company. The plaintiff sought eviction after terminating the lease. The court examined Section 106 of the Kerala Land Reforms Act, 1963, determining that neither the original foreign lessee nor its successors qualified for non-evictability protections due to lack of continuity and ineligible lessee status. Substantial questions framed included whether a Government company under Article 12 is entitled to Section 106 benefits, if successor lessees can claim construction benefits, and if rights transfer via government notification. The court held no continuity of lease existed post-original expiry and vesting, rendering Section 106 inapplicable to successors. Appeal allowed; first appellate court's decree reversed, trial court's eviction decree restored.
| Table of Content |
|---|
| 1. core issue of lease continuity and protection (Para 4 , 5) |
| 2. denial of section 106 to successor lessees (Para 6) |
JUDGMENT
The plaintiff in a suit for eviction of the defendant – M/s Hindustan Petroleum Corporation Ltd., has come up in the present appeal, aggrieved by the reversal of the judgment and decree granted in his favour by the Sub Court, Mavelikara. 2. The brief facts necessary for the disposal of the appeal are as follows:
2.1. The plaint scheduled property was leased out to a foreign company named, Standard Vacuum Oil Company, by an agreement dated 06.12.1952 by the paternal grandfather of the appellant. The period of lease was for ten years. The lease was renewed in the year 1962 for a further period of ten years. On 15.11.1974, after a protracted proceedings, the fair rent in respect of the transaction was fixed at Rs.200/- per month. While so, the Government enacted ESSO (Acquisition of Indian Undertakings) Act No.74 of 1976. Thus, the Central Government became the lessee in respect of the property. Subsequently, the property where the petroleum outlet was functioning was assigned in favour of the respondent - M/s Hindustan Petroleum Corporation Ltd. and they continued with the business. Later, the plaintiff’s father inherited the property from his grandfather and thereafter, executed a gift deed on 16.11.1994 in his favour. On 03.08.1995, the plaintiff issued notice terminating the lease. Finding that the defendant has refused to vacate the premises, the suit was filed. The suit was resisted by the defendant contending that, they are entitled to the protection ofSection 106of the Land Reforms Act, 1963 and are entitled for protection from eviction. 2.2. On behalf of plaintiff, Exts.A1 to A6 documents were produced and PW1 and PW2 were examined. On behalf of the defendant, Exts.B1 alone was produced. No oral evidence was adduced by the defendant. The trial court, by judgment dated 17.07.2003, decreed the suit and ordered the defendant to be evicted from the plaint schedule property. Aggrieved, the defendant preferred A.S.No.252/2004 before the Additional District Court-I, Mavelikara. The first appellate court reversed the judgment and decree in favour of the plaintiff, holding that the defendant was entitled to the protection ofSection 106of the Land Reforms Act, 1963. A cross objection preferred by the plaintiff for enhancement of the rent was also dismissed.
Aggrieved, the plaintiff has come up in the present appeal. 3. On 21.02.2012, this Court admitted the appeal on the following substantial questions of law:
(i) Is a Government company coming under Article 12 of the Constitution of India entitled to claim the benefit of non- evictability underSection 106of Act 1 of 1964?
(ii) When the alleged structures in the leasehold premises have been put up by the original lessee, can the successor lessee claim benefit of such construction as envisaged under Act 1 of 1964?
(iii) When during a period Central Government was the lessee of the schedule property and was consequently not entitled to non-evictable right under Section 106 of Act 1 of 1964, could it is a transferee-defendant acquire such right by virtue of a notification of the Central Government?
(iv) Was the first appellate court justified in interfering with the findings of the trial court without entering a finding that they are unreasonably wrong or perverse?
4. Heard, Adv.R.Azad Babu – learned counsel appearing for the appellant and Adv.M.Gopikrishnan Nambiar - learned Standing Counsel appearing for the respondent.
5. The only question to be considered by this Court in this appeal is, whether the respondent is entitled for protection of Section 106 of the Kerala Land Reforms Act, 1963. Indisputably, the original lessee was a foreign company and the lease was for a period of ten years and that the said lease was renewed. During the currency of the renewal period, ESSO (Acquisition of Indian Undertakings) Act No.74 of 1976 came into effect and the p
