1 (CRA128.2007) IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION CIVIL REVISION APPLICATION NO.128 OF 2007 Life Insurance Corporation of India ) a Statutory Corporation, established ) by an Act of Parliament, being Central ) Act No.XXXI of 1956, having its Western) Zonal Office at Yogakshema, Jeevan ) Bima Marg, Mumbai 400 021 ) ...Petitioner. (Orig.Defendant/ Respondent V/s The Board of Trustees of the Port ) of Mumbai, ) a Statutory Corporation, having its ) office at Vijay Deep. S.V. Marg, Fort, ) Mumbai 400 038. ) ....Respondent. (Origial Appellant/ Plaintiff) Mr. S.K. Nair i/b S.K. Nair & Co. for the Petitioner. Mr. U.J. Makhija, Senior Counsel i/b M/s Motiwala & Co. for the Respondent. CORAM: V. M. KANADE, J. DATE : 15th June, 2011 2 (CRA128.2007) ORAL JUDGMENT: 1. The Petitioner is original Defendant and the Respondent is original Plaintiff. Respondent is challenging the judgment and order passed by Appellate Bench of the Small Causes Court in Appeal No.757 of 2004 in L.E. & C. Suit No.21/32 of 1984. The Appellate Bench of the Small Causes Court was pleased to allow the appeal and set aside the judgment and order of the Trial Court and decreed the suit with costs and directed the Petitioner herein to hand over possession of the suit premises and also directed the Petitioner to pay decretal amount of Rs 26,856/- with interest @ Rs 15% per annum from the date of filing of the suit till realization and further directed that inquiry be made into mesne profit under Order 20 Rule 12 of the Civil Procedure Code. 2. Brief facts are as under:- 3. The Petitioner is a Statutory Corporation established by and under the Life Insurance Corporation Act, 1956 and is duly owned by the Central Government and carries on 3 (CRA128.2007) business of life insurance in India. The Respondent is Board of Trustees of the Port of Mumbai and and it is also a Statutory Corporation incorporated and established under the provisions of the Major Port Trusts Act, 1963. 4. An agreement of lease dated 16/12/1960 was executed between the Trustees of the Port of Bombay (hereinafter referred to for the sake of convenience as “Plaintiff – Port Trust” and Life Insurance Corporation of India (hereinafter referred to for the sake of convenience as “Defendant – LIC”) for lease of land and building on the Sewree Estate, admeasuring 872-3/9 square yards, for use as offices, shops-cum-residences, restaurants, workshops, godowns for storage of non-hazardous goods and residences. The lease agreement was to take effect from 20/4/1954 for a period of 25 years and end on 19/4/1979. The Plaintiff-Port Trust sent a letter dated 12/11/1979 to the Defendant-LIC, asking them whether they wanted renewal of the lease. A reply was sent by the Defendant-LIC to the Plaintiff-Port Trust by their letter dated 22/3/1980 in which it was stated that they were willing to surrender the premises on “as is where is basis” subject 4 (CRA128.2007) to tenancies and since the building standing on the leasehold land had been modified unilaterally by the Plaintiff-Port Trust, it was not to renew the lease. The Plaintiff-Port Trust by its letter dated 9/4/1980 pointed out clause 7(5) of the lease dated 16/12/1960 wherein the Defendant-LIC was to handover the vacant possession of the suit premises to the Plaintiff-Port Trust. Since the Defendant-LIC did not handover the vacant possession of the premises, by letter dated 17/11/1980, Plaintiff-Port Trust terminated tenancy of Defendant-LIC and called upon the Defendant-LIC to quit, vacate and deliver peaceful possession of the premises by removing any structure or structures standing thereon under the occupation of Defendant-LIC. This notice was duly served upon the Defendant-LIC. Thereafter, again, the tenancy was terminated by Plaintiff’s advocate’s notice dated 15/3/1983. A reply was sent by Defendant’s advocate by letter dated 22/9/1983 refusing to comply with the requisitions contained in the notice dated 15/3/1983. Therefore, a suit was filed seeking vacant and peaceful possession of the suit premises and for other consequential reliefs. 5 (CRA128.2007) 5. The Defendant-LIC filed its Written Statement and contended that the Defendant had already surrendered their leasehold rights or tenancy rights in respect of the suit premises and, therefore, the Plaintiff-Port Trust had no right to claim possession when they had illegally refused to take over possession of the suit premises despite valid surrender of the rights by the Defendant-LIC in the suit premises. It was contended that the Defendant had validly surrendered its interest in the suit premises and it was obligatory upon the Plaintiff-Port Trust to accept the surrender. It was contended that in view of covenant No.26 as contained in para 5 of the Lease Deed, the question of refusing to comply with the contents of para 7(5) of the Lease Deed did not arise and that the Plaintiff-Port Trust was not entitled to claim vacant possession of the land. It was contended that what was given on lease to the Defendant was the land together with buildings and works erected thereon. 6. Trial Court dismissed the suit of the Plaintiff-Port Trust. It held that the Defendant-LIC had proved that the 6 (CRA128.2007) description of the suit premises was not correct and further held that the Plaintiff is not entitled for decree of possession of the suit premises and it is also not entitled to claim arrears of compensation and mesne profits. The Trial Court relied on clause 2 of the Lease Deed and held that the said clause specifically showed that the suit premises consisted of piece of land together with buildings for the time being standing on the said land. Trial Court also relied on clause No.5(9) which permitted the Plaintiff to carry out the repairs to the structures at its own costs. Trial Court, therefore, came to the conclusion that, in the plaint, suit premises was described as land only. Being aggrieved by the said judgment and order, Plaintiff-Port Trust preferred an appeal before the Appellate Bench of the Small Causes Court vide Appeal No.757 of 2004. This appeal was allowed by the Division Bench and the Judgment and Order of the Trial Court was set aside and the suit was decreed. The lower Appellate Court interpreted certain clauses of the Deed and came to the conclusion that the Plaintiff-Port Trust was entitled to get vacant possession of the land. Being aggrieved by the judgment and order passed by the lower 7 (CRA128.2007) Appellate Court, Defendant-LIC has filed this Civil Revision Application. 7. The learned Counsel appearing on behalf of the Petitioner submitted that the lower Appellate Court had misconstrued the clauses of the lease and wrongly came to the conclusion that the Plaintiff was entitled to get vacant possession of the land and duty was cast on Defendant-LIC to remove the structures which were standing thereon. It was submitted that the finding, therefore, recorded by the lower Appellate Court was perverse. Secondly, it was submitted that the lower Appellate Court misconstrued the ratio of the judgment of the Apex Court in Kamla Devi vs. Laxmi Devi 1 and by wrongly relying on the observations made by the Apex Court in the said judgment set aside the judgment and order of the Trial Court. It was submitted that the ratio of the said judgment was not applicable to the facts of the present case. 8. On the other hand Shri Makhija, the learned Senior 1 (2000) 5 SCC 646 8 (CRA128.2007) Counsel appearing on behalf of the Respondent/Plaintiff invited my attention to the various clauses of the Lease Deed and submitted that the lower Appellate Court had correctly appreciated the Lease Deed and has recorded a finding that in view of the clauses in the Lease Deed, Plaintiff was entitled to get vacant possession. He submitted that this Court, while exercising its jurisdiction under section 115 should not interfere with the said finding. He invited my attention to clauses 3 and 4 of the Lease Deed and also clause 5(2). He then invited my attention to clause 2 for the purpose of pointing out what was leased out to the Defendant-LIC. He, thereafter, invited my attention to clause 7(5) and submitted that on conjoint reading of the aforesaid clauses it was clear that Defendant-LIC had to remove the said structures standing thereon and handover vacant and peaceful possession of the land to the Plaintiff- Port Trust and if they failed to remove it, the entire liability was on the Defendant-LIC. 9. After having heard the learned Counsel appearing on behalf of the Petitioner and the learned Senior Counsel 9 (CRA128.2007) appearing on behalf of the Respondent, I am of the view that there is much substance in the submissions made by the learned Counsel appearing on behalf of the Petitioner and the Division Bench of the Small Causes Court has clearly committed an error of law which is apparent on the face of record for the following reasons. 10. The lower Appellate Court has not taken into consideration the frame of the suit and the relief claimed by the Plaintiff. Secondly, it has not taken into consideration some of the clauses of the Lease Deed and, thirdly, the lower Appellate Court has misconstrued the ratio of the judgment of the Apex Court. 11. It is an admitted position that the Trustees of the Bombay Port Trust leased out a plot of land by virtue of Lease Deed dated 16/12/1960 for a period of 25 years, beginning from 20/4/1954. The terms and conditions on which the plot was leased were incorporated in the Lease Deed. The period of lease expired on 19/4/1979 and Respondent wrote a letter to the Petitioner dated 8/1/1979 10 (CRA128.2007) and submitted a fresh proposal, offering a new lease on fresh terms and conditions. The Petitioner by their letter dated 22/3/1980 informed the Bombay Port Trust that modification of the terms was not acceptable and they had decided to surrender their interest and premises on “as is where is” basis. Thereafter, the Bombay Port Trust filed a suit, seeking vacant possession of the plot of land, compensation and mesne profits. 12. The dispute between the parties essentially was that, according to Bombay Port Trust they were entitled to get vacant possession of the land and, on the other hand, Petitioner’s contention was that the lease was in respect of the land alongwith existing buildings and, therefore, there was no question of handing over vacant possession of land. According to the Petitioner/LIC, only in the event of structures being erected by the Petitioner, such structures would be demolished. 13. Taking into consideration the aforesaid controversy between the parties, it will have to be seen what was the 11 (CRA128.2007) relief claimed by the Plaintiff in their suit. In the plaint, it was contended by the Bombay Port Trust that the LIC had failed and refused to comply with covenant 7(5) of the lease dated 16/12/1960 and did not handover vacant possession of the said premises. Accordingly, the relief claimed was as under:- “(a) that the Defendant be ordered and decreed to deliver forthwith to the Plaintiffs vacant and peaceful possession of the suit premises more particularly described in Exhibit ‘A’ hereto;” Exhibit-A to the Plaint gives particulars of description of the premises which reads as under:- “PARTICULARS OF DESCRIPTION OF THE SAID PREMISES All that piece of land belonging to the Trustees in the Island of Bombay situate on the Sewree Estate containing by admeasurement Eight Hundred and Seventy Two Square Yards and three- ninths of another square yard that is Seven 12 (CRA128.2007) Hundred and fifty two sqaure metres and Eighty nine square decimeters or thereabouts and bounded as follows that is to say on or towards the North the North East and the North West by other Land belonging to the Trustees and leased to Hansraj Bahri & Others and Amirchand Khimchand Zaveri & Ors respectively and on or towards the South-West by Jackeria Bunder Road and on or towards the South-West by Jackeria Bunder Lane No.2 which said piece of land is registered in the Books of the Collector of Land Revenue, Bombay under Cadastral Survey No.22/147 (Parel Sewree Division) and in the books of the Assessor and Collector of the Municipal Corporation of Greater Bombay under Ward No.F/S-07/2765(1), 2765(1A) Street No.6, 6A, & 6B, Jackeria Bunder Road/Sewree and is situate in the Registration Sub-District of Bombay.” In this context, therefore, it will be necessary to examine the terms and conditions of the said Lease Deed. In the said lease agreement, the land is defined as under:- “1(4) “The said land” shall mean all the land and hereditaments hereby demised and shall include any buildings or works or creations whatsoever from time to time standing 13 (CRA128.2007) thereon.” Clause 1(5) Defines the term “buildings” and the clause 1(6) defines the term “the said premises” and the said clauses 1(5) and 1(6) read as under:- “1(5) “The buildings” shall mean any building or buildings from time to time standing on the said land.” “1(6) “The said premises” shall mean and include the said land the buildings the works and everything comprised therein or enjoyed therewith and shall be construed in the widest sense.” Clause 2 of the said lease clearly stipulates that the trustees had given to the Lessee all that piece of land together with buildings standing thereon. Clause 5(26) is very relevant and the said clause had not been taken into consideration at all by the lower Appellate Court. The said clause reads as under:- “5(26) At the expiration or sooner 14 (CRA128.2007) determination of the said term (subject only to the proviso hereinafter contained entitling the Lessee to remove the buildings and works constructed by the Lessee in the events specified) quietly to deliver up to the Trustees the said premises with the buildings and works in good and substantial repair and condition.” 14. In my view, there is much substance in the submission made by the learned Counsel appearing on behalf of the Petitioner that the said clause 5(26) has to be read in juxtaposition with clause 7(5). The lower Appellate Court appears to have read the said clause 7(5) in isolation without taking into consideration that the said clause would apply only if new buildings are constructed by the LIC. Trial Court, therefore, was justified in coming to the conclusion that the description of the suit premises in the plaint itself was not proper since the suit premises was described as “land” and not “land alongwith buildings”. Trial Court, therefore, rightly came to the conclusion that the Plaintiff, therefore, was not 15 (CRA128.2007) entitled for decree of possession since the suit is filed in respect of premises which are not properly described in the plaint. Trial Court was also right in coming to the conclusion that clause 2 of the said Lease Deed specifically mentions that what was demised to the LIC was piece of land together with buildings for the time being standing on the said land. 15. Apart from that, both the Courts below have not taken into consideration that clause 5 deals with Lessee’s covenant whereas clause 7 deals with the conditions of the grant and enjoyment of the lease. Clause 5(26) clearly stipulates that at the expiration or determination of the lease of the said term of lease, the LIC should deliver to the Trustees the said premises with the buildings and works in good and substantial repair and condition. There is, however, a proviso in the said clause. It says that this is subject to the Lessee being entitled to remove the buildings and works constructed by the Lessee. A condition, therefore, has been imposed on the Lessee that the Lessee should surrender the land alongwith buildings which were leased to him. However, if any buildings were constructed after execution 16 (CRA128.2007) of the lease, those buildings had to be removed by the Lessee. Similarly, clause 7 deals with conditions of the grant and enjoyment of the lease. The sub-clause (5) of clause 7 stipulates that the Lessee shall remove the buildings and works then standing on the said land. The effect of the said clause obviously is that if any buildings are constructed by the Lessee after the land and buildings were leased out to them, only such buildings were required to be removed by the Lessee and not existing buildings. It has nowhere come on record that the LIC had constructed any new buildings. The lower Appellate Court, therefore, was not justified in coming to the said conclusion. 16. The lower Appellate Court also relied upon the judgment of the Apex Court in Kamla Devi vs. Laxmi Devi1 and more particularly on the following paragraph. “11........ In deciding this question, it will be useful to bear in mind that if a plot with a structure was let out it will fall within the meaning of the term 1 (2000) 5 SCC 646 17 (CRA128.2007) “premises” but if an open plot without any structure was let out then it does not fall within the meaning of the term “premises”. It is immaterial whether the tenant raised structures before the creation of the tenancy or after he was let in as a tenant. In either case, the tenant alone will have the proprietary rights in the structure and not the landlord.” In the said case, the landlady had let out a property consisting of one big room, to the Respondent. There was a vacant land next to the property, also belonging to the landlady. The Respondent built a latrine on that small plot of land without authorization. The landlady, therefore, filed a suit for injunction directing the Respondent to demolish the structure. Consent Terms were filed in the said suit and it was agreed that the Respondent would pay Rs 5/- per month to the Plaintiff being rent of the open land. Thereafter, by notice dated 19/12/1983 plaintiff (appellant) terminated tenancy which had been created under the compromise and filed a suit for recovery of possession of the vacant plot. The 18 (CRA128.2007) Respondent/tenant challenged the landlady’s right to file the suit and it was contended that the suit plot came under the definition of “premises” contained in section 2(i) of the Delhi Rent Control Act, 1958 and the suit was barred under section 50 of the Act. In this context, the Apex Court made the aforesaid observations. The ratio of the said judgment, therefore, obviously, would not apply to the facts of the present case since, in the present case, Lease Deed itself clearly indicates that what was leased to the LIC was the land alongwith structures. There is no material on record to indicate that the LIC had constructed any new structure apart from the structures which were already in existence. The lower Appellate Court, therefore, clearly erred in relying on the ratio of the said judgment. The judgment and order of the lower Appellate Court, therefore, will have to be set aside. 17. Civil Revision Application is allowed in terms of prayer clause (a) and disposed of. (V.M. KANADE, J.) 19 (CRA128.2007)