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Citation Codes
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Case Number
Attorney(S)
  • Mr. Bahar U. Barqui, Adv.
  • Mr. Kamal Mehta with Mr. Sudeep Singh, Advs. for R-1.
  • Ms. Sweety Manchanda, CGSC for R-2 & 3.
Judges
  • Acting Chief Justice
  • Rajiv Sahai Endlaw, J.
Acts
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Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Attorney(S)
  • Mr. Bahar U. Barqui, Adv.
  • Mr. Kamal Mehta with Mr. Sudeep Singh, Advs. for R-1.
  • Ms. Sweety Manchanda, CGSC for R-2 & 3.
Judges
  • Acting Chief Justice
  • Rajiv Sahai Endlaw, J.
Acts
See more information ...
Smart Summary

Judgment Summary

Factual and Procedural Background

These two intra-court appeals challenge the common order dated 1 May 2012 of the learned Single Judge dismissing W.P.(C) No. 1116/2012 and W.P.(C) No. 1200/2012 filed by the appellant. The writ petitions related to two premises in Jeevan Bharti Building, 24, Connaught Circus, New Delhi (one of 801 sq. ft. on the first floor and the other of 891 sq. ft. on the fifth floor) belonging to the respondent Life Insurance Corporation of India (LIC) and occupied by the appellant. The appellant impugned notices served by LIC terminating the appellant's tenancy of those premises.

Legal Issues Presented

  1. Whether the notices of termination of tenancy served by LIC were in contravention of the Guidelines notified on 30 May 2002.
  2. Whether the notices were bad in view of the appellant's offer to increase the rent by 100% of the last paid rent (with reliance on Parsis Kothawala v. LIC and subsequent decisions).
  3. Whether the writ petitions were maintainable at the stage when the respondent had only determined the tenancy and statutory proceedings under the Public Premises (Eviction of Unauthorized Occupants) Act, 1971 (the PP Act) were available.

Arguments of the Parties

Appellant's Arguments

  • The notices of termination, coupled with a threat of eviction and recovery proceedings before the Estate Officer under the PP Act, contravened the Guidelines notified on 30 May 2002.
  • The notices were invalid because the appellant had offered to increase the rent by up to 100% of the last paid rent; reliance was placed on the Bombay High Court judgment in Parsis Kothawala v. LIC 2004 BCR 4 614 and follow-up proceedings culminating in New India Assurance Co. Ltd. v. Nusli Neville Wadia (2008) 3 SCC 279.
  • The appellant's counsel also pointed out that Special Leave Petitions had been preferred to the Supreme Court against this Court's decision in Life Insurance Corporation of India v. Damyanti Verma and sought restraint on LIC pending the outcome of those SLPs (relying on an interim order mentioned by counsel).

The opinion does not set out detailed, separate counter-arguments by the respondent LIC in the terms of party-by-party submissions; the court's reasoning discusses legal positions and prior authorities relevant to LIC's stance.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Parsis Kothawala v. LIC 2004 BCR 4 614 Relied upon by the appellant to argue that notices are bad in face of offer to increase rent. Not accepted as overturning this Court's position; cited to record appellant's reliance.
Nusli Neville Wadia v. New India Assurance Co. Ltd. 2006 (3) MhLJ 713 Reference to SLP having been dismissed in relation to the Bombay High Court decision. Noted as part of the line of authorities relied upon by the appellant.
New India Assurance Co. Ltd. v. Nusli Neville Wadia (2008) 3 SCC 279 Supreme Court decision upholding the earlier Bombay High Court view relied upon by the appellant. Recognised as part of the appellant's reliance but not treated as altering this Court's settled view in the cited decisions.
Life Insurance Corporation of India v. Damyanti Verma Held that the Guidelines of 30 May 2002 are not of binding nature (Division Bench judgment of this Court dated 23 March 2012). The Court followed this decision and held the matter not res integra; the Single Judge had relied on this to dismiss the writ petitions.
Indian Institute of Public Opinion Pvt. Ltd. v. Life Insurance Corporation of India (LPA No. 9/2012, judgment dated 11 May 2012) Considered and clarified issues concerning the Guidelines and carved out an exception for affluent tenants. The Court referred to this judgment and observed the appellant falls within the category of affluent tenants to which the exception applies.
D.P Maheshwari v. Delhi Administration (1983) 4 SCC 293 High Courts should not stop proceedings before a tribunal by deciding preliminary objections; deprecated entertaining challenges to preliminary objections. Relied upon to support the proposition that writ jurisdiction under Article 226 should not be used to stall statutory proceedings.
Shops and Commercial Workers Union v. Management of Ayurvedic and Unani Tibbia College Board MANU/DE/0176/1979 Expressed concern about delay caused by entertaining petitions that stall proceedings. Cited to reinforce the view against entertaining writ petitions at an interim or preliminary stage.
National Council for Cement & Building Materials v. State of Haryana (1996) 3 SCC 206 Commented on the problem created by entertaining petitions at interim stage and staying tribunal proceedings; no justification for stalling final adjudication. Used to support refusal to entertain the present writ petitions which would delay statutory proceedings.
Hindustan National Glass & Industries. Anr… v. Uoi & Ors… 132 (2006) DLT 454 Statutory proceedings pending at the show cause notice stage ought not to be interfered with by writ jurisdiction under Article 226. Cited to hold that statutory PP Act proceedings at the show-cause stage should not be bypassed by writ petitions.
Pepsico Restaurants International (I) (P) Ltd. v. Municipal Corporation of Delhi (1995) 35 DRJ 616 High Court should not entertain a writ petition against a mere show cause notice except in case of patent lack of jurisdiction or violation of principles of natural justice. Cited to support that the High Court should leave the petitioner to raise these contentions before the statutory authority and challenge the outcome thereafter.
The Special Director v. Mohd. Ghulam Ghouse (2004) 3 SCC 440 Deprecated entertaining petitions challenging show cause notices. Relied upon to discourage entertaining writ petitions at the stage of a show cause/notice.
Nopany Investments (P) Ltd. v. Santokh Singh (Huf) (2008) 2 SCC 728 Held that a notice to quit under Section 106 of the Transfer of Property Act is not necessary because filing eviction proceedings under general law is itself a notice to quit. Noted by the Court and observed to have been followed by a Division Bench of this Court in a later decision.
Shri Ram Pistons & Rings Ltd. v. C.B Agarwal Huf MANU/DE/2381/2008 Division Bench followed the reasoning in Nopany Investments regarding notice to quit and eviction proceedings. Cited to buttress the view that proceedings under eviction statutes may themselves constitute notice to quit.

Court's Reasoning and Analysis

The court's analysis proceeded along the following lines, based only on the material in the opinion:

  1. The Single Judge had dismissed the writ petitions on the basis that the Guidelines dated 30 May 2002 were not of binding nature, following the Division Bench decision in Life Insurance Corporation of India v. Damyanti Verma, and that the appellant could raise all available defences before the Estate Officer in proceedings under the PP Act.
  2. This Division Bench had recently dealt with the matter in Indian Institute of Public Opinion Pvt. Ltd. v. LIC and related matters and observed that the clarification to the Guidelines carves out an exception for affluent tenants; the appellant here was held to fall within that category.
  3. The appellant's reliance on pending Special Leave Petitions was rejected: the court held the matter was not res integra for this Court in view of the cited judgments, and mere preferring of SLPs or issuance of notices in SLPs does not alter that position. The interim order in the SLPs was noted not to stay the operation of this Court's judgments.
  4. The court emphasized practical experience that occupants of public premises can keep Estate Officer proceedings pending for years; this reinforced the view against entertaining the writs to delay statutory proceedings.
  5. The court found the writ petitions not maintainable because LIC had only determined the tenancy and the appellant admitted that the lease terms had expired. The PP Act provides for statutory proceedings and an appeal mechanism before the Estate Officer; the appellant should avail the statutory remedy instead of pre-emptively challenging the notices by way of writ.
  6. The court relied on established authorities (including the Supreme Court and Division Bench decisions) disapproving the practice of High Courts entertaining preliminary objections to stall tribunal or statutory proceedings, and applied those principles to decline interference.
  7. On the offer to increase rent by 100%, the court observed that the appellant was an old occupant paying a meagre rent and that even doubling would not reach market rent; the court reiterated its prior view that LIC need not accommodate a tenant at its own loss when higher market rent could be obtained.
  8. Concluding from the foregoing, the court found no error in the Single Judge's order dismissing the writ petitions.

Holding and Implications

APPEAL DISMISSED

Holding: The Division Bench affirmed the Single Judge's dismissal of W.P.(C) No. 1116/2012 and W.P.(C) No. 1200/2012 and found the appeals without merit.

Implications: As a direct consequence of this decision, the order of the Single Judge stands affirmed and the appellant's challenge to the notices of termination is dismissed. The appellant is expected to avail the statutory procedures under the Public Premises (Eviction of Unauthorized Occupants) Act, 1971 and before the Estate Officer rather than bypassing those remedies by filing writ petitions. The judgment records that there are no costs.

Show full summary ...

    International Building & Furnishing Co. Pvt. Ltd. Petitioner v. Life Insurance Corporation Of India

    JUDGMENT

    RAJIV SAHAI ENDLAW, J.

    1. These two Intra-Court appeals impugn the common order dated 1st May, 2012 of the learned Single Judge dismissing W.P(C) No. 1116/2012 and W.P(C) No. 1200/2012 preferred by the appellant. The said writ petitions were preferred with respect to the two premises, one ad-measuring 801 sq. ft. on the first floor and the other ad-measuring 891 sq. ft. on the fifth floor, of Jeevan Bharti Building, 24, Connaught Circus, New Delhi of the respondent LIC in occupation of the appellant and impugning the notices served by the respondent LIC on the appellant of termination of tenancy of the appellant of the said two premises.

    2. The challenge by the appellant to the notices of termination of its tenancy of the two premises was predicated on the following grounds:-

    (i) that the notices of termination of tenancy, with a threat, on non-compliance thereof, of proceedings for eviction and for recovery of damages for use and occupation before the Estate Officer of the respondent under the provisions of The Public Premises (Eviction of Unauthorized Occupants) Act, 1971 are in contravention of the Guidelines notified on 30th May, 2002.

    (ii) that the notices are bad in the face of the offer of appellant to increase the rent by as much as 100% of the last paid rent. Reliance in this regard was placed on the judgment of the Bombay High Court in Parsis Kothawala v. LIC 2004 BCR 4 614, SLP No. 22904/2004 whereagainst was dismissed by the Supreme Court, Nusli Neville Wadia v. New India Assurance Co. Ltd. 2006 (3) MhLJ 713 upheld by the Supreme Court in New India Assurance Co. Ltd. v. Nusli Neville Wadia(2008) 3 SCC 279.

    3. The learned Single Judge dismissed the writ petitions holding-

    (a) that as far as the Guidelines notified on 30 May, 2002 are concerned, the same vide judgment dated 23rd March, 2012 of the Division Bench of this Court in Life Insurance Corporation of India v. Damyanti Verma have been held to be not of binding nature;

    (b) that it is even otherwise open to the appellant to take all defences available to it in the proceedings under the PP Act.

    4. We, besides in Damyanti Verma supra, have also had an occasion to exhaustively deal with the subject in our judgment dated 11 May, 2012 in LPA No. 9/2012 titled Indian Institute of Public Opinion Pvt. Ltd. v. Life Insurance Corporation of India and in other connected matters, one of which was of the counsel for the appellant herein. In view thereof need is not felt to burden this judgment with the same matter. Suffice it is to state that clarification to the Guidelines also carves out an exception in favour of affluent tenants and in which category the appellant definitely falls.

    5. The counsel for the appellant contends that Special Leave Petitions to the Supreme Court have been preferred against our judgment in Damyanti Verma (supra) and vide interim order in which SLPs, dispossession has been stayed. He contends that the present appeals be entertained to await the outcome of the decision of the Supreme Court and in the meanwhile the respondent LIC be restrained from proceeding against the appellant before the Estate Officer.

    6. We are unable to agree. As far as this Court is concerned, the matter is no longer res integra in view of the judgments supra in Damyanti Verma and Indian Institute of Public Opinion Pvt. Ltd. Mere preferring of SLPs and issuance of notice therein does not change the position. Significantly, the interim order of the Supreme Court does not stay the operation of the said judgments. Moreover experience has shown that such occupants of public premises are able to keep the proceedings even before the Estate Officer pending for several years and for this reason also the contention of the counsel for the appellant cannot be accepted.

    7. We are also of the opinion that writ petitions even otherwise were not maintainable. The respondent LIC has vide notices impugned only determined the tenancy of the appellant. The appellant even otherwise admits the term of the leases in its favour to have expired. It is not as if the respondent LIC after expiry of the term of the lease or determination of the tenancy is forcibly evicting the appellant. Resort is being taken to the provisions of the PP Act which also provides for statutory appeal against the order of the Estate Officer, if at all, against the appellant. We fail to see as to how the appellant, instead of availing of the said procedure prescribed in law can jump the gun and challenge the notices by filing the writ petitions especially when the legal position as far as this Court is concerned stands settled vide judgment Damyanti Verma and in Indian Institute of Public Opinion Pvt. Ltd. It is not as if the appellant does not otherwise want to contest the proceedings under the PP Act and is intending to challenge the same on these grounds only. Entertaining a challenge at this stage to the notice of termination when the appellant does not give up the right to otherwise contest the proceedings before the Estate Officer would tantamount to delaying the proceedings before the Estate Officer till the decision on the said aspect.

    8. The Supreme Court in D.P Maheshwari v. Delhi Administration(1983) 4 SCC 293 has deprecated the practice of, first entertaining the challenge on preliminary objections and held that the High Courts in the exercise of their jurisdiction under Article 226 of the Constitution of India ought not to stop proceedings before the Tribunal so that a preliminary issue may be decided by them. It was further held that the jurisdiction under Article 226 of the Constitution of India ought not to be permitted to be so exploited. Even prior to the said judgment of the Apex Court, this Court in Shops and Commercial Workers Union v. Management of Ayurvedic and Unani Tibbia College Board MANU/DE/0176/1979 had expressed anguish at delay caused by entertaining such petitions. The Supreme Court again in National Council for Cement & Building Materials v. State of Haryana(1996) 3 SCC 206 commented upon the appalling situation created by entertaining such petitions at interim stage and staying the proceedings before the Tribunal. It was observed that there is no justification for a party to the proceedings to stall the final adjudication of the dispute by raising preliminary issues.

    9. A Division Bench of this Court in Hindustan National Glass & Industries. Anr… v. Uoi & Ors… 132 (2006) DLT 454 held that statutory proceedings pending at the stage of show cause notice ought not to be interfered with in exercise of discretionary jurisdiction under Article 226 of the Constitution and which proceedings ought not to be permitted to be bypassed by resort to writ proceedings under Article 226. Another Division bench in Pepsico Restaurants International (I) (P) Ltd. v. Municipal Corporation of Delhi(1995) 35 DRJ 616 has also reiterated that the High Court should not entertain a writ petition against a mere show cause notice except in the case of patent lack of jurisdiction in the authority issuing the notice or violation of principles of natural justice. It was held that the High Court should leave such a hasty petitioner to pursue the remedy of showing cause against the notice raising all his contentions for the consideration of the statutory authority and then approach the High Court in the event of the result going against him. The Supreme Court also in The Special Director v. Mohd. Ghulam Ghouse(2004) 3 SCC 440 has deprecated entertaining the petition challenging the show cause notices.

    10. Notice may also be taken of Nopany Investments (P) Ltd. v. Santokh Singh (Huf))(2008) 2 SCC 728 laying down that a notice to quit under Section 106 of the Transfer of Property Act is not necessary in as much as filing of an eviction proceedings under the general law itself is a notice to quit upon the tenant. The said reasoning was followed by a Division Bench of this Court in Shri Ram Pistons & Rings Ltd. v. C.B Agarwal Huf MANU/DE/2381/2008.

    11. As far as the offer of the appellant to increase the rent by 100% is concerned, the appellant is an old occupant of the premises at meager rent; even doubling would not bring the rent anywhere close to prevalent market rent. We have already in Indian Institute of Public Opinion Pvt. Ltd. held that when the premises of respondent LIC can fetch a higher rent, there is no reason for LIC to, to the advantage of a particular tenant and at its own loss, accommodate such tenant.

    12. Thus, whichever way we may look, no error can be found in the order of the learned Single Judge. The appeal is without any merits and is dismissed.

    No costs.

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    Comments

    International Building & Furnishing Co. Pvt. Ltd. Petitioner v. Life Insurance Corporation Of India
    (Jul 18, 2012)