THE HON’BLE SRI JUSTICE N.V. RAMANA W.P. Nos. 12054 and 12055 of 2010 Common order: Assailing the notices dated 22.05.2010, issued by respondent No. 2, namely the Commissioner, Kurnool, Municipal Corporation, Kurnool, calling upon the petitioners to produce receipts evidencing payment of the amounts mentioned therein else the same would stand confirmed, the petitioners filed the present writ petitions to declare the said notices as illegal and arbitrary. The petitioner in W.P. No. 12054 of 2010 and the petitioner in W.P. No. 12055 of 2010 shall be referred to as petitioner Nos. 1 and 2 respectively. The petitioners state that respondent No. 2 constructed a Shopping Complex at Door No. 40-493, Park Road, Kurnool. Petitioner No. 1 and one K. Md. Iqbal, made applications dated 09.01.2010 to respondent No.2, for leasing out the open terrace place on the first floor of the Shopping Complex, for construction of six and seven shops respectively. Based on the recommendations of the Standing Committee, resolution No. 84 was passed by the Kurnool Municipal Corporation on 16.03.2000, leasing out the open terrace place on the first floor of the Shopping Complex, for a period of three years, subject to the conditions mentioned therein. According to the petitioners, as per the conditions of the lease, the lessees have to construct the proposed shops at their own cost as per the designs given by the Municipal Corporation and also pay rent of Rs.1,200/- per month for each shop. After expiry of the three years lease period, the lease is further renewable for a period of three years at 33-1/3% enhancement. As pet the conditions of the lease, petitioner No.1 and the said Md. Iqbal, constructed shop Nos. 19 to 24 and 12 to 18 respectively by investing their own funds, and the construction of the shops having been completed, possession thereof was handed over to them in the year 2001. After taking over possession of the shops, petitioner No.1 and the said Md. Iqbal were continuing as lessees. While so, petitioner No.2 states that Md. Iqbal, by taking money spent by him towards construction of the shops, handed over the possession of the shops to him by informing the same to respondent No.2, and by virtue thereof, petitioner No.2 continued in the lease. After expiry of the lease period in the year 2004, the petitioners state that the lease period was renewed for a further period of five years with 33-1/3% enhanced rents. The petitioners state that as per the orders issued by the Government in G.O. Ms. No. 686, dated 30.04.1968 read with G.O. Ms. No. 384 dated 19.07.1988, the lessees are entitled to continue in the lease, extendable upto 25 years, subject to the lessee agreeing to enhance the rents by 33-1/3% on the existing rent or the prevailing market value of such shops, whichever is higher, without conducting any auction. While so, the petitioners state that respondent No.2 issued notices dated 15.05.2010 stating that they failed to pay the rents due upto May, 2010, despite oral and written notices, and demanded them to pay Rs. 7,45,594/- and Rs. 11,25,578/- respectively towards shop rents, including the enhanced rentals. The petitioners state to the said notices, they submitted explanation to respondent No.2, stating that due to recent floods, their businesses were adversely affected, and requested to provide 15 days time to submit the records, but without considering their request, the petitioners state that respondent No.2 issued the impugned notices. Heard the learned counsel for the petitioners and the learned Standing Counsel for respondent No.2. Though the petitioners contend that they have invested huge amounts for construction of the shops and are paying monthly rent of Rs.1,200/- per month for each shop, the same is disputed by respondent No.2 in the counter filed by him. It is the case of respondent No.2 that the petitioners are defaulters of rent. It is stated that Md. Iqbal is the lessee, and that petitioner No.2 has no right whatsoever to purchase the lease and take over the lease granted to Md. Iqbal. That petitioner No.2 is not their lessee and that they have not recognized him as such, and that as the lessees are chronic defaulters, respondent No.2 issued notice dated 15.05.2010 calling upon them to clear the dues of Rs.7,45,594/- and Rs.11,25,578/- upto May, 2010 respectively, which is inclusive of 33-1/3% enhanced rent. It is the further case of respondent No.2 that earlier when steps were taken to close the shop, petitioner No.1 issued cheques, dated 31.03.2010 and 22.04.2010 for Rs.4,00,000/- and Rs.1,00,000/-, but the same bounced, and in fact, this is even mentioned in the impugned notice. It is stated that so far petitioner No.1 and Md. Iqbal had paid rents of Rs.4,73,600/- and Rs.2,96,800/- respectively, and they are required to pay the amounts mentioned in the impugned order. As petitioner No.1 and Md. Iqbal in spite of granting time to produce receipts evidencing payment if any, which shall be given credit to, instead of producing the details of the payments made, have taken a stand that their business was adversely affected due to floods, and considering the fact, that the plea raised by the lessees was incorrect because their shops were located on the first floor, respondent No.2, once again issued the impugned notice, granting three days time to produce the details, as otherwise, the amounts mentioned therein, which are due and payable will be confirmed, and as the petitioners did not furnish the details of payments made by way of receipts, respondent No.2 confirmed the amounts payable by petitioner No.1 and Md. Iqbal, from whom petitioner No.2 claims to have taken possession of the shops on lease, under the impugned demand notice, an no exception can be taken thereto, particularly when the same are confirmed after issuing prior notice to petitioner No.1 and Md. Iqbal, calling upon them to furnish the details. Though the petitioners contend that their leases were extended by five years, the same is dispute by respondent No.2, and it is his contention that their request for extension of lease by five years, was referred to the Government, but the Government did not accede to the proposal and requested them to strictly comply with the orders issued by them in Memo dated 12.03.2004. That being so, the petitioners cannot contend that they are entitled to extension of leases or continue their leases for a period of 25 years without auction subject to enhancement of rents by 33-1/3% or as per the prevailing market rents without putting the shops to auction, and more so when they are said to be chronic defaulters. For the foregoing reasons, there is no merit in the writ petitions, and the same are accordingly dismissed. No costs. ________________ N.V. RAMANA, J. Dated: 26th November, 2010. KSR