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Smart Summary

Concise Analytical Summary of the Opinion

Factual and Procedural Background

The plaintiff, Karam Singh, sued for a permanent injunction restraining the defendants, their employees or agents from interfering with his possession and enjoyment of a five-acre suit property (a nursery) and from cutting or withholding power to a tube-well on the premises. The plaintiff alleged that he was granted a lease of the five acres at an annual rent of Rs. 3,000 by an agreement dated 2 January 1992, permitted to develop a nursery and that he reclaimed and developed the land and made a tube-well workable with a power connection provided by army headquarters.

On 15 January 1994 the plaintiff alleged that local staff under defendant No. 3 withheld electricity and threatened dispossession. The defendants filed a written statement denying the plaintiff's right to possession, asserting termination of tenancy by a notice dated 27 November 1993, and relying on an arbitration clause (clause 14) in the agreement that, according to them, required disputes to be referred to the sole arbitrator (the Commandant).

The court framed two issues on 28 August 1998: (1) whether the suit is not maintainable because of the arbitration clause (preliminary objection); and (2) whether the plaintiff is entitled to the relief claimed. Evidence included DW1 (Major D.K. Bahri) who produced an office order and letters, and PW1 (the plaintiff) who said he was prevented from entering the nursery, did not receive a termination notice and that his labourers and customers were barred entry.

Legal Issues Presented

  1. Whether the present suit is not maintainable for the reason stated in paragraph 1 of the written statement (i.e., the arbitration clause and related contention)?
  2. Whether the plaintiff is entitled to the relief claimed (permanent injunction restraining dispossession and withholding of power, and protection of ingress/egress and visitors)?

Arguments of the Parties

Plaintiff's Arguments

  • The plaintiff asserted he held possession under the lease dated 2 January 1992, had developed the nursery and made the tube-well workable with provided power connection.
  • He alleged that from January 1994 he was stopped from entering the nursery by defendants and that his labourers and customers were not permitted entry.
  • He stated he had not received any notice terminating the tenancy.

Defendants' Arguments

  • The defendants relied on clause 14 of the agreement containing an arbitration clause, arguing disputes should be referred to the sole arbitrator (the Commandant) and thus the suit should not proceed in court.
  • They contended that the tenancy had been terminated by the notice dated 27 November 1993 and denied that the plaintiff had any right to remain in possession or that he increased the tube-well depth or made the asserted improvements.
  • The defendants also relied on a policy decision dated 21 December 1993 that, according to them, prescribed that no defence land is to be given on a contractual basis for cultivation and such contracts would be terminated immediately.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
State of UP vs. UP University Colleges Pensioners' Association Illustrates that courts afford limited interference in matters of state policy decisions. The court distinguished this case as inapplicable: that case dealt with a state policy on pension computation and there was no contract inter se between parties, whereas the present matter is governed by a contract granting the plaintiff specific rights.
M.C. Chockalingam & Ors. vs. V. Manickavasagam & Ors. Consideration of what constitutes lawful possession of a tenant versus a licensee; a tenant after expiry of lease cannot be said to continue in lawful possession against the landlord's wishes unless protected by law. Referred to the principle that mere continuation in possession after lease expiry does not necessarily constitute lawful possession against the landlord; used as background on the nature of possession rights.
M.R.S. Ramakrishnan vs. Assistant Director of Ex-Servicemen Welfare (District Soldiers, Sailors and Airmen Board), Tirchirapalli & Ors. Holds that a tenant in possession of leasehold property after termination of lease cannot be dispossessed by force except under due authority of law; position is the same for tenancy under the Government. The court relied on this authority (paragraph 10) to support the proposition that forcible dispossession is impermissible and that the plaintiff enjoys protection against such dispossession even if the lease is challenged.
M/s Patil Exhibitors (Pvt.) Ltd. vs. The Corporation of the City Bangalore Articulates the rule that the rule of law precludes forcible dispossession and courts protect against forcible dispossession even if the possession is litigious; relief protects against forceful eviction rather than adjudicating title. The court expressed respectful agreement and adopted the view that courts will protect against forcible dispossession and will not countenance self-help removals, applying that principle to the facts here.

Court's Reasoning and Analysis

The court proceeded by addressing the two framed issues sequentially.

Issue No. 1 (arbitration objection / maintainability): The court noted that while the arbitration clause in the agreement was not denied, the defendants had not availed themselves of the remedy under Section 34 of the Arbitration Act, 1940 to seek a stay of the suit. Instead, the defendants were contesting the suit by filing a written statement and presenting evidence. Because no application under Section 34 was filed to stay proceedings, and the defendants took steps to contest the suit, the court held it was "too late in the day" for the defendants to assert that the proceedings should be stayed. Consequently issue No.1 was decided against the defendants.

Issue No. 2 (entitlement to relief): The court accepted that the agreement dated 2 January 1992 existed and reproduced relevant clauses (2, 3, 4, 5, 7 and 9), which established (a) a five-year lease at Rs. 3,000 per year, (b) provisions about gate access, (c) allocation of investment/loss/profit responsibilities, (d) permission to construct nursery structures, (e) a clause on tube-well repair liability depending on use, and (f) a requirement that the plaintiff's employees obtain police character verification.

From these clauses the court concluded that the plaintiff was in possession of the suit premises. The pivotal legal question was whether that possession could be terminated by the defendants at will. The defendants' reliance on a government policy dated 21 December 1993 (prohibiting defence land being contractually given for cultivation) and on State of UP (supra) was considered. The court rejected the defendants' policy argument: it emphasized that the rule of law limits government power and that the State of UP authority concerned pension policy and did not govern a contractual dispute between private parties and the State in the same manner as here.

The court then turned to authorities establishing that even where tenancy may have been terminated, a tenant in possession cannot be dispossessed by force and that courts protect against forcible dispossession. Relying on the cited Supreme Court and High Court decisions (notably M.R.S. Ramakrishnan and Patil Exhibitors), the court held that its protection is not to validate title per se but to prevent forcible dispossession; "the protection that the court will afford is not to the possession even if the lease had been terminated but a protection would be against forcible dispossession."

Taking account of security concerns (the premises being in a high security zone) and contractual clause 9 requiring police verification for employees, the court limited relief: while defendants are restrained from dispossessing the plaintiff except by due process of law, access by the plaintiff's employees and customers is subject to necessary police character verification or requisite permission from Army authorities.

Holding and Implications

The court decreed the suit in part: the defendants are restrained from dispossessing the plaintiff from the land in dispute except by due process of law.

Implications:

  • Direct effect: The defendants cannot effect a forcible dispossession of the plaintiff; any termination or dispossession must proceed by due legal process. The plaintiff's employees and customers may access the premises only if they possess the requisite police verification of character or have necessary permission from the Army authorities, reflecting the contract clause and the high-security nature of the site.
  • Costs: Parties were directed to bear their own costs.
  • Broader precedent: The judgment applied and relied on existing authorities concerning protection against forcible dispossession but does not announce or claim to establish a new legal principle beyond applying those authorities to the facts; the decision's direct consequence is limited to the parties and their rights of possession and access as described above.

    Karam Singh v. Union Of India And Ors.

    1. Karam Singh, plaintiff has filed the present suit seeking permanent injunction against the defendants to restrain the defendants, their employees or agents from interfering with the possession of the plaintiff and enjoyment of the plaintiff in respect of the suit property or obstructing his free ingress and egress to the suit premises including his employees and customers. It has further prayed that defendants should not cut or withhold the power supply to the tube-well installed in the suit premises.

    2. The facts alleged are that the plaintiff was granted lease of the suit premises measuring 5 acres on annual rent of Rs. 3000/-. An agreement dated 2nd January, 1992 was executed. Under the said agreement plaintiff was permitted to develop a nursery. The tenancy is stated to be continuing. The plaintiff reclaimed the barren land and developed nursery. He made a tube-well workable. The army headquarters had provided the requisite power connection.

    3. On 15.1.1994 it is alleged that local staff working under defendant no.3 withheld the supply of electricity and plaintiff was threatened of dispossession. Without the tube-well, it is stated that the plaintiff cannot run the nursery, alleging that he is being threatened of dispossession and that the water supply is being withheld without reason. The present suit refers to the above has been filed.

    4. In the written statement filed the defendants contested the suit. It is asserted that there is an agreement between the parties and it has an arbitration clause. As per clause 14 the matter under dispute is to be referred to the sole arbitrator who is the Commandant. It was prayed therefore the present suit should not continue. As per the defendants the tenancy of the plaintiff had been terminated by the notice of 27th November, 1993. Earlier to that the land was not barren. It was a developed land. It is denied that the plaintiff had increased the depth of the tube-well. It is further denied that plaintiff has any right to be in possession of the premises.

    5. From these pleadings of the parties this court on 28th August, 1998 had framed the following issues:-

    1. Whether the present suit is not maintainable for the reason stated in para 1 of the written statement (preliminary objections)?

    2. Whether the plaintiff is entitled to the relief claimed?

    6. In support of the respective claims Major D.K. Bahri had appeared as DW1. He stated that office order of 27th November, 1993 was issued by Major G.S. Chaudhary. He also proved the letter of 9th February, 1994, copy of which is DW 1/2 and that DW 1/4 is the letter which was sent to the plaintiff by registered post. As against this evidence, the plaintiff appeared as PW1. he state that in January 1994 he was stopped from entering into the nursery by the defendants. Thereafter he had field the present suit. After the ad interim order was passed by this court he had attempted many a times to go to the nursery but was not permitted. His labourers and customers were also not permitted. He has told that civilians cannot enter the nursery. he also stated that he did not receive any notice from the defendants regarding termination of the tenancy.

    7. It is on basis of these evidence that the above said issues have to be gone into.

    8. Issue No.1: It has been alleged that in the arbitration agreement there is a clause to refer the dispute to the arbitrator and therefore the suit should not proceed. Though the arbitration agreement as such is not being denied but the defendants at no stage had preferred any application under Section 34 of the Arbitration Act, 1940 for staying the present suit. in other words, necessary steps were taken and written statement even was filed. Therefore, when no such application contemplated under Section 34 of the Arbitration Act had been field and steps were being taken by the defendants in contesting the suit, indeed it is too late in the day to assert and claim that the present proceedings should be stayed. Issue accordingly is decided against the defendants.

    9. Issue No.2: As referred to above plaintiff's plea is that there is an agreement between the parties which in any case is admitted and is not in controversy. It is dated 2nd January, 1992. The land had been given to the plaintiff for setting up of the nursery and paragraphs 2, 3, 4, 5, 7 and 9 of the same read as under and are relevant:

    "2. That the above said five acres of land has been provided for a period of five years to him at a rent of Rs. 3000/- (Rupees Three thousand only) half of which is Rs. 1500/- (Rupees one thousand and five hundred only). The rent to Rs. 3000/- will be charged per year.

    3. That for the use of the above said land for Nursery, Gate No. 11 will be provided for use permanently but in emergency Gate No. 1 may also be used.

    4. That SECOND party will be responsible for all kinds of investment/losses and profits and FIRST Party shall not be responsible at all.

    5. That SECOND party can construct Chic House, Green House for plaints and sheds in the above said land provided to him.

    7. That if SECOND party does not use the tube-well at all for six months, repair charges will be borne by FIRST party. Otherwise SECOND party will be responsible for making the payment of repair of tube-well.

    9. All employees of SECOND party will have to get police verification of character done from appropriate police station."

    10. Bare reading of these clauses show that the land was leased to the plaintiff for an amount of Rs. 3000/- to be paid per year. The employees of the plaintiff have to get the police verification of character from the appropriate police station. It was agreed that in case the plaintiff does not use the tube-well at all the repair charges were to be borne by the defendants otherwise it is the plaintiff who was responsible for making the payment of the repairs. The plaintiff was to set up the nursery.

    11. In other words, it is abundantly clear that the plaintiff was in possession of the suit premises as such.

    12. The short question that comes up for consideration is as to if when plaintiff is in possession whether he can be dispossessed at the will of the defendants or not. Learned counsel for the defendants urge that there is a policy decision in this regard and once there is such a policy decision it cannot be questioned in any court and in this process the plaintiff cannot be permitted to continue. In support of his claim the learned counsel relied upon the decision of the Supreme court in the case of State of UP vs. UP University Colleges Pensioners' Association .

    13. Before proceeding further it may be appropriate to refer to the said policy decision of the 21st December, 1993 which prescribes that no defense land is to be given on contractual basis for cultivation. Such contracts will be terminated immediately. The complete details of the vacant land should be given and that no encroachment is to be permitted on the defense land.

    14. The argument of the learned counsel for the defendants as simply to be stated to be rejected. In a country governed by the rule of law to state that the Government has the power to do anything and take any policy decision would be totally contrary to the concept of rule of law. No person can be permitted to take the land into his own hand. Even decision in the case of State of UP (supra) is totally beyond the scope of what has been urged. It the cited case on the demand of teachers of various aided educational institutions for better terminal benefits like pensions etc., the State of UP had formulated a new scheme of pension and provident fund. It also provided besides other thing for computation of pension on basis of last pay drawn at the age of 58 years. it had been a pegging down computation of pension to pay drawn at 58 years when a teacher of aided college was allowed to retire at 60 years, was invalid. it was in this backdrop that the court held that there would be little interference in such policy decisions. Indeed the cited case cannot be made applicable because there was no contract inter se between the parties, as in the present case. The present matter in question is governed by the contract and plaintiff had been conferred a certain right pertaining to the nursery which has already been referred to above and therefore once such rights flow from the contract, the defendants can act in accordance with law after terminating the contract.

    15. In that event it had been urged that the plaintiff in any case cannot claim that he is entitled to the injunction prayed. At the outset, it would be appropriate to refer to the decision of the Supreme Court in the case of M.C. Chockalingam & Ors. vs. V. Manickavasagam & Ors. . The question as to what would be lawful possession of a tenant and that of a licensee had come up for consideration before the Supreme Court. The Supreme Curt held that a tenant on expiry of the lease cannot be said to continue in lawful possession of the property against wishes of the landlord if such possession is not otherwise protected under law against even lawful eviction through court process. But whether the landlord in that event can take possession except in due process of law was consideration in the case of M.R.S Ramakrishnan vs. The Assistant Director of Ex-Servicemen Welfare (District Solders, Sailors and Airmen Board), Tirchirapalli & Ors. . The answer was provided in paragraph 10, the relevant portion reads as under:-

    "Thus the preponderance of the Judicial opinion is that the tenant in possession of the leasehold property after the termination of the lease cannot be dispossessed by force except under due authority of law and the position is not different in the case of a tenancy under the Government.

    16. Same question was again considered by a Bench of the Karnataka High Court in the case of M/s Patil Exhibitors (Pvt.) Ltd. vs. The Corporation of the City Bangalore . In paragraph 10 the court held:-

    "The second aspect of this. It is part of the concept of "Rule of Law" that no claim to a right to dispossess by the use of force without recourse to procedure in accordance with law is recognised or countenanced by Courts. Such a right in the respondent cannot be recognised regardless of the question whether or not the appellant itself has any subsisting right to remain in possession. The protection that the court affords is not of the possession which in the circumstances is litigious possession and cannot be equated with lawful possession - but a protection against forcible dispossession. The basis of relief is a corollary of the principle that even with the best of title there can be no forcible dispossession."

    17. This court finds itself in respectful agreement with the said view. Necessarily one can only reproduce and state that the protection that the court will afford is not to the possession even if the lease had been terminated but a protection would be against forcible dispossession. it is not a case of a rank trespasser that the court will refuse the permanent injunction. It is not even a case of an ordinary trespasser. Therefore, the plaintiff could not be dispossessed in the facts of the present case except due process of law.

    18. However, it was pointed that the defendants should not interfere in the employees and customers of the plaintiff visiting him in this regard. It was rightly pointed that since it is high security zone, the customers and the employees must have the police verification in this regard. This fact is echoed even in the agreement. With respect to the employees it was specifically provided that they must the police verification on character from the appropriate police station. necessarily by implication it would also be made applicable to the customers, if any, of the plaintiff. To that extent the plaintiff is not entitled to any relief.

    19. For these reasons the suit only is decreed that defendants shall not dispossess the plaintiff from the land in dispute except in due process of law. So far as employees and customers of the plaintiff are concerned, they would be permitted to visit the premises provided they have the necessary verification character done from the appropriate police station or has the necessary permission to visit from the Army authorities. Parties are lift to bear their own costs.

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    Comments

    Karam Singh v. Union Of India And Ors.
    (Aug 13, 2001)